Detroit Metro Connections & Scaling Advice

[Leslie Beia]

Hi Folks! I've been in REI for about 5 years. I started with an Airbnb, added several more, I am completing my second BRRRR and have successfully flipped 2 houses this year in Austin, TX where I live. This has all been very good experience, but I am ready to focus and scale: one asset class, one location, one strategy.

I am from MI and am starting to spend more time here. I'm excited about the future of Detroit! I feel like a gambler who got pretty lucky in Austin and I would like to get out of there while I'm ahead, as it is still a correcting market and houses are quite expensive. I do not feel I can scale there the way I would like to. I'd like to focus on flipping for the next few years, smaller SFH (entry point up to $150k) in up-and-coming neighborhoods, 10+ houses per year.

I feel pretty confident about the flipping process having done 4 full rehabs as well as several more minor ones. I have connected with an RE-focused agent who is sending me properties to research, but I'm not sure if he is the right fit yet. As I will not be living in the area it is imperative that I have a solid and active team on the ground, and I'm looking to connect with folks who have a deep understanding of the area and would like to do work together. 

I have working capital, a solid understanding of how to analyze properties and the rehab process, and I am great at design. I would be open to partnering up with someone on the ground who can source properties and project manage. Also looking for energetic agents, wholesalers, and other investors who might want to mentor, collaborate, and/or point me towards networking resources. Obviously I don't have much to offer currently in terms of local knowledge but I love connecting and sharing info and plan to be a valuable and helpful part of the investor community there. I am staying up north but can be down there a few times per month. I'll be ready to start buying in September! Thanks and I look forward to connecting with folks. 

[Travis Biziorek]

Hey Leslie, the Detroit market is awesome if/once you know what you're doing.

A couple quick thoughts... the <$150k price point is a tough one to flip in. In fact, Detroit in general is a tough market for flippers. For the most part, it's been a buy-and-hold or BRRRR market.

If you do plan to flip in that price range you're going to need an intimate knowledge of the area, demand drivers, and how to remodel these older homes efficiently. 

Above $150k is also tough because there are only so many areas that will command price points $200k+ and only so much demand from end buyers.

That said, I know people that do it and do well with it. I'd just recommend really taking your time before jumping in. Best of luck!

[Drew Sygit]

@Leslie Beia As @Travis Biziorek stated, flipping in Detroit is a bit different then many other areas of the country - but, that means there's plenty of opportunitues!

Under $150k properties are very challenging as not many homeowners are actually available in that range currently - but, their numbers are growing. The Neighborhood is extremely important and so is the specific block. We've got one right now on Chatham that's under contract on which our client should do pretty well.

The $150k-$225k is popular, but sourcing due to competition is the challenge. Just have to write more offers and buy uglier properties:)

Flips are done at even higher price points, but again, have to be very careful to understand the Neighborhood, where it's heading and then the block.

We've applied Class A, B, C & D labels to all of Detroit's 183 Neighborhoods - to help investors make wiser choices. DM us if that info might be useful to you.