Where flippers find their properties

Question

This post is for all the rehabbers and flippers out there. I have a long term buy and hold strategy but have recently been interested in learning more about flipping and doing maybe 1 or 2 flips a year. I want to know where you are finding your deals. I know there are many ways - auctions, direct mail, driving for dollars, MLS, etc. I want to know what YOUR method is and what do YOU find most successful. A breakdown of how many houses you bought for flipping using each method would be awesome! Thank you in advance.

Dev Horn · Answer

Not surprisingly, our #1 method is marketing direct to motivated sellers via direct mail, PPC, and outdoor advertising. Other methods are (a) REOs and (b) auctions. Auction.com has become a very active marketplace. Some people find deals thru services such as MyHouseDeals.com. (No affiliation).

Andres Calderon · Answer

My family has been in the real estate industry for over 30 years dealing in both commercial and residential and the best strategy as far as safety and profitability goes (that's what matters) would be through tax deed auctions which is what i have dedicated myself to now. You cant go wrong with this. You can purchase a property for 60-70 cents on the dollar fix her up then resell it for market values. Its obviously a bit more complexed than that but look at some of the properties i have purchased through tax deed auctions. http://www.youtube.com/watch?v=TasuOJlf04A Regards, Andres Calderon realestateauctionkings.com

Justin S. · Answer

@Aaron Helmholdt - Last year I did ~40 flips and all of them were off the MLS. This year auctions have loosened up so I've purchased 2 from there but most of the deals are MLS deals. I've never had much luck with direct mail marketing but I'm sure the spreads are much better than MLS deals, but I likely cannot produce 40-60 deals from direct mail per year.

Bryan L. · Answer

@Aaron Helmholdt - Yes, I know someone who has been very successful without being a Realtor. But he really got after it and really did some deals, making it worthwhile for a Realtor to work with him. It's just so much easier to be a Realtor yourself though.

Account Closed · Answer

All this thread is proving is that deals can be found all over and in any matter of marketing methods. You just have to go out and get them. There is no replacement for "Taking Action"..

Dev Horn · Answer

I am not a paying member of MyHouseDeals.com. I bet there are some good deals in there, and we think those guys are legit. If you don't pay, the free leads from there are just the scraps left over after the paying members have picked thru them (totally cool, that's the way their model works...). You're right that the numbers are pretty weak, and I don't completely trust the numbers you get. They are estimates (repair & ARV) plugged in by the seller or wholesaler so you really need to run your own numbers on any deal. Despite the drawbacks, I like their model. We're thinking about offering a similar "wholesaler marketplace" in the near future...

Corey Gentry · Answer

@Dev Horn Do you find very many deals on MyHouseDeals.com? Ive noticed that they only list the ARV and Repair cost, they dont include all the additional cost associated with the flip.

Aaron Helmholdt · Answer

Great info! It's nice to see everyone's different strategies. @Bryan L. In your opinion do you think it is realistic for someone who does not have access to the MLS to be successful using a realtor to relay that information? @Dev Horn Thanks for sharing that top level security secret!

Dev Horn · Answer

Mailing to out of state owners is a closely guarded trade secret. If I told you, I'd have to... you know.... Well, really, it's not that big of a mystery. Listsource.com allows you to select only out-of-state absentee owners. Use the %Equity filter or a mortgage origination date at least 15 years ago. Pull your list there and hit it once a month. Stay at it for AT LEAST 6 months. // "It is not the mountain we conquer, but ourselves." ~ Sir Edmund Hillary

Account Closed · Answer

It's going to vary by region and market. Where I am, anyone doing any real volume when it comes to buying and selling rehabs (3-5+ per month) is buying at the courthouse steps, pretty much exclusively. I watch the data for 3 counties and since 2009 or so, it's the same groups rehabbing and reselling through trustee's sale acquisitions. With so many people wanting to get in to RE, most REOs here don't have the necessary equity for flippers. At this time most of the equity at the courthouse steps is created by dropped minimum bids on upside down properties. I'd love to hear from those doing direct marketing who are acquiring any real volume of properties for flipping. I know mail marketing brings all kinds of opportunities and it's my main source of deals. But the opportunities are way more varied than the equity necessary for a flip. Anyone doing 25+ flips a year and using mailing marketing exclusively?