All Forum Posts by: Jonathan C.

Thanks guys

@Matthew Dovner

Over 60 year old owners (owner occ and absentee) that have at least 40% equity in their properties. Ended up being like 28,000 names across the DC Metro area.

@Sam B. yeah no problem. I'll also try to post some info on some of the flips I am currently doing that have some stuff that other people may be able to learn from.

@Peter Hanson that's an awesome track record. Well done!

RE: direct mail- I'm a big proponent of it. I get most of my deals off listed properties the same way you do- lots of low cash offers. I've started focusing more and more on direct mail though over last 2 years. Did 8 deals from direct mail last year and 3 so far this year with 2 more supposed to close this month.

I mainly do a version of the 'yellow letter'. No real trick I've found with it beyond having enough volume where you'll get something from it. I did 4,000 letters/mo last year and this year bumped to 6,000 letters/mo.

@Account Closed 80% of my deals come from listed properties. I make 2-6 offers a day usually 6 days a week. Almost all my listed deals since the investor market has gotten much more competitive have been short sale deals where the seller accepted (and bank ultimately) approved a price that was much less (15-30% I'd say) than the list price. In other words, I make a ton of low ball offers and see what sticks :)

The other 20% are from direct marketing and relationships I've been able to start to build with some wholesalers, hard money lenders, and some agents I've done business with before.

I also wholesaled 8 houses that year- those were 100% from my direct marketing. I sent out 4,000 yellow letters/mo last year. This year bumped it to 6000 letters/mo.

@Drew Denham 2 main ways I'd recommend:

1- network with other investors, do your best to get them to like you, and ask them for contractor referrals. The problem is a lot of investors who have good contractors won't refer them out because they don't want them spread too thin, so it's going to be a bit of a numbers game here as well. You'd do this through WREIAs primarily

2- Another way, which is how I found 1 of my 2 main crews, is to call up rehab material suppliers. I called my cabinet supplier and asked him if he knew any good contractors and he gave me the name of the guy I work with now.

The key for me has been (through trial and error unfortunately) finding 2 good contractors who I can be almost entirely hands off with and leveraging some basic technology so I focus most of my time and attention on finding deals.

I've found that in order to do a decent volume of houses the vast majority of my time and attention needs to be on finding good deals, since that's the hardest part of this.

Having really solid contractors who can make some minor paint/tile/house layout decisions and do a decent job with it has been crucial.

Also- leveraging basic technology- for example I have a part time employee I pay to go around to all my rehabs once per week to take 5-10 minute videos and upload them to my google drive. This allows me to manage the rehabs without having to actually go visit the houses.

Also a big fan of using oDesk and other virtual assistants to outsource most of my document signing and other admin work.

One of the higher end areas in Prince George's County, MD. Usually stick to ARVs of 300k or less. This one listed for $407k now. Hopeful to get something close to that.

Numbers:

Buy: 232,000

Rehab: 82,000

Sell (expected): 390,000 net

Did first flip in 2010, then switched areas to focus on a lower income county in the DC Metro area and did 3 flips in 2011.

Stayed in same area, got credit line with local bank, and did 8 flips in 2012. In October of that year was able to quit my job and invest full time.

In 2013 did 17 flips.

Hopefully 20-25 flips in 2014- though market for investor properties is really tight now so we'll see. Should at least clear 20 though.

I haven't been very active on BiggerPockets but plan to change that. Try to help people out where I can. And I still have plenty to learn.

Full time investor in DC Metro here

Rehab market in this area very competitive, but can still find deals. Primarily will be off market which requires- networking, bandit signs, letters, etc.

Thanks everyone-- extra thanks to J Scott for pointing me to that article.

I'm actually a licensed agent so I'm selling my own properties, and I won't accept an offer unless the buyer is pre-approved. I'll give a run down of 2 of the recent reasons deals have fallen apart even with pre-approvals.

1) lender didn't pull CAIVRS until the end of the loan process and, when he did, he found buyers had another government insured debt they defaulted on (I actually got a copy of the desktop underwriting for these buyers)
2) lender told me over and over again it isn't a problem for their bank to loan on properties owned less than 6 months where sell price is greater than 120% of the purchase price, until file was actually sent to underwriting- again at end of process- at which point underwriter told them they cannot do the loan

And this is after pre-approval and verbal confirmation lender pulled credit, verified income, cash to close.