All Forum Posts by: Eric Percival

Cornell,

That's a 3% response rate. 

Usually people get 1%. Your're doing good if you get 4-5%

The response rate also might be affected if you send mail cards instead of letters or if you hand written the letter vs computer print out.

If you increase your mail outs to 500 or 1000 you can close at one deal from that 4-5% call back rate.

I know it's expensive for someone new to RE wholesaling

What are the condition of the property?

How much is the debt she wants to pay?

Can you assume her mortgage? 

Option 1:

Conventional financing 

Option 2: 

Hard Money, Renovate, Rent out, Refinance with higher rent

Option 3:

Seller Finance (give her the money she needs to pay her debt as a down payment and pay the rest in payments). You can then refinance later on to conventional.

By the way, I don't have a experience financing but that's what I have currently been focusing on learning. We like to see other people inputs. 

Hey Jim,

I understand your logic, but even if you have 3 great deals in a year, you still have time to acquire more deals if you delegate correctly. 

Here is an example of a 4plex I acquired when I worked as a manager for a wholesaler (the numbers are a little different):

ARV: $830,000

70%: 581,000

Repair: $107,190 / $30 per sqft (Living Sqft: 3,573)

Offer Price: $473,810

Total Cost $581,000 - ARV sale $830,000 = $250,000 profit

We kept the 4plex to flip, but the city of miami took forever to approved the plans. After a year and a half of holding the 4plex we sold it for a profit of $102,000  without making any renovations. 

threw all the marketing in Miami and Broward, a deal like this didn't come that often for us. The bread and butter was rehabbing for 25- 50k profit. 

Also, we tried marketing for upscale properties in the 1M range for spec homes to make a higher profit per property, but for 7 months are outside sales rep couldn't close a deal at the price we wanted. The avg. home owner in that price range are a lot savvier to their real property value. 

At the end, regardless of the price of the property or how many property we had in our portfolio, if it was more than 25-40K profit per deal we didnt pass it up, the owner of the company will always have the financing setup. Also the owner of the wholesale company I worked for has flipped 75+ properties in other states but I never asked him what system he implement to achieve those flips in the other states. 

Hi Gus,

Thanks for the input and my thought was the same as yours. I was actually doing some research on maybe hiring a part-time intern or employee to help out and came across that job listing. I was a multifamily property manager and manager for a wholesaler, and decided I had enough experience to start my own company. The previous companies I've worked I handled all the operation except the financing of the deals which is something I lack, but have been reading multiple books on the subject.

Hi,

I was researching a real estate company that posted an intern job as a Commercial Real Estate Acquisition trainee. Upon doing research on the company's website they have posted their most recent deals (1M-3M deals) added value properties. and under each property they have the details that it was acquire all cash with no inspection period and the name of the listing broker.

What I was left wondering was under what circumstances will an investor offer all cash no inspection on multiple multifamily with some form of financing (private money/hard money) and avoid the risk of the financing falling apart during the closing process?

If there's no inspection to get the books, how do they know the true cap rate? or are they basing the offer on each individual unit as it was vacant.

The job of the intern is to make multiple offers to brokers & upon closing interns gets paid 15k bonus while also making 15hr

Just trying to wrap my head around this as I would like to know how multifamily deals & offers are structured

Hey Jesse,

That's exactly what I did. I did it because my budget was super tight and couldn't afford to pay construction workers. I did the work myself.

In regards to dust, every property is different, there are some I would definitely not take the chance  (too much dust or mold).

First thing is to air out the property, buy a industrial fan an open all the windows and doors and let it vent. second clean the place, and let it the property vent a couple of times. If there's an A/C unit turn it on after you have tried to clean/vent all the dust out.

I borrowed my mom's air mattress, and slept with no a/c for the  first months (I had a leak in the freon line and the ac tech couldnt find it.) Most people won't do this but if you're really motivate and you have a big WHY, you would.

The property is an 1hr and 30min from my parents house so I visit them on the weekend, and to get a better sleep.

I didnt bring much stuff only the essential: air matress, a plastic drawer with clothes, my laptop, and I bought a mini fridge from OfferUp. If you bring other stuff is a pain when you have to move things around... painting and laying floors.

I've done a couple of flips and currently redoing my business plan for 2018.

I have a couple of questions for the people that are flipping 20+ properties within a year which is my goal.

1. If you're flipping 20+ properties, do you flip outside of your city or state?

2. Are you licensed as a real estate broker or a general contractor?

3. Most of your deals where do they come from? direct mail, MLS, HUD, auction etc.?

4. Do you implement a marketing strategy to collect private money to match with deals? if you have a financing marketing strategy what are they; such as direct mail, networking, hard money, bank relationships etc?

5. Which employees are vital to go from a few flips to 20+, such as personal assistants, marketing/sales associates, project manager ect? which would you hire first to expand your business?

6. I belief one of the key aspect to growth is to learn how to delegate, do you delegate important things such as obtaining financing & how to get mailer's list or give them access to mls for REOs? I basically worked for an investor that didn't want no one to know his core strategies and didn't like to delegate those things, I don't think that's a good idea if you want to grow.

7. If you were to do it again is there something you will do differently?

8. What other advice would you give someone like me that wants to upscale their flipping business?

Thanks,

I managed a couple of multifamily rental properties from South Beach to Sunny Isles including one in Meridian Ave. I have always seen a lot of sale listings in Miami Beach mostly due to short term living on the beach. They buy and sell within a year. 

South Beach prices for units are high compared to the rent, so keep that in mind when youre calculating the cap rate.

Hello,

I'm really considering becoming a general contractor to project manage my properties & have a better chance at obtaining financing.

One thing has always being stuck in my head since I went to to see a mortgage broker & lender about 7 months ago. I went to him with the proposition of networking and introducing myself; I told him that I had a partnership which was a general contractor and myself (I have the experience; worked for a multifamily investor and a flipper as a general manager plus I have good credit & cash). At the meeting the GC canceled last minute and I attended the meeting myself, The lender was interested on the GC that he can work with the GC to obtain a loan and it looks good on paper, while for me he told me that I was pretty young and anyone can type up a resume saying they were a real estate asset general manager, I honestly think he didn't believe me when I told him I have 18+ flips and I had reposition 5 multifamily in Miami Beach. He said that I needed a track record. 

The partnership did not work out. A couple of months later I went in all cash (55K) and (8k for repair), that's all my savings. I  bought an apartment to flip. It's my very own first flip, but it sucks having all your cash tied up in a single property & eating cereal & sandwiches all the time haha. I did not have enough to hire workers so I've done all the work myself. I'm currently doing punchout, and will be listing the property on Tuesday through a flat fee broker. 

After the sale, I'm thinking of getting my GC license? I will like anyone's input if it will become easier to obtain financing.

Thanks,

Purchased price $55,100.

Rehab Cost: $50,000

ARV: 160,000

The property is consider an unsafe structure by the city, and has violation due to illegal additions ( one bedroom, and a separate efficiency). There's a lot of rehab that needs to be done. I will submit plans to the city showing the corrections, I would hire a GC just to pull permits, and project manage the rehab myself. I can probably do the rehab for $35,000