Advice for a New Out of State Flipper

[Christian Hwang]

Hi everyone. 

I'm currently flipping properties in my backyard (SoCal) and have the liquidity to fund multiple projects. However, I enjoy the more operational side of flips and would like to grow my business out of state to increase flipping volume and have less competition in finding deals. I know the grass is not always greener on the other side, but any tips on finding my next market?

Below are some actionable steps I plan to take after identifying a market:

- find a rock star agent by referral and/or calling brokerages and asking to connect with their top producing agents

- find a rock star contractor by referral and/or yelp

- have control over construction by setting per diems to incentivize contractor to finish the project on time, within budget, and with good quality

- leverage my rock star agent's time to check up on the construction process (checks and balances)

- hire independent handymen/inspectors to check up on the construction process for a flat fee (checks and balances)

[Jonathan Greene]

I think will find that out-of-state will be much more operationally challenged than local. Even if you have a good framework, it's much harder to manage virtually and stay on track. It certainly helps that you've done it, but I would maybe do one that is still in CA, but far so you can't go every day and see how that is and then inch out.

On finding an agent, definitely not the way to go in terms of calling brokerages and asking for their top producing agent. The top producing agent wants nothing to do with a new out-of-state investor, they are local specialists who don't need extra business or time suck. You need boots on the ground to see who lists flips and who lists dumps. That is who you want.

The best contractors will never, ever be on Yelp. They don't care about Yelp or the internet. That is for larger companies or for disgruntled clients or relatives looking to help.

Per diems only work in theory. If you give contractors a prize for finishing early on time, they will finish then to get the prize, but there is plenty that can be left undone without you knowing that will harm you later. Things like these only sound good, they don't work.

Again, the top producer would never go by your flip, ever, in a million years. You want a hustler, not a top performer, if you want check-ins.