All Forum Posts by: Justin Williams

Boom @Christian Lautenschleger ! That is awesome! It took we 7 months of working my tail off to close on my first deal so kudos to you! It is easy to see what some people are doing in the business and think that is going to happen to us overnight but I guarantee you anyone who has had a decent amount of success in this or any business has worked incredibly hard at it and has a lot of battle scars to show for it. The first one is by far the hardest so good for you!

Yes you are correct about the accountability thing! Somedays I feel motivated and like taking on the world while others I don't want to do much of anything. By letting thousands of people know what my goals are and reporting my weekly progress I am allowing also allowing my ego to hold me accountable which although we may not admit it sometimes it is probably one of the strongest motivators! lol

Thanks for the comment and keep us posted on your continued progress!

Weekly Update 4/20-4/26

Last week I was starting to think I would be reporting a fat "goose egg" for my weekly update but then Friday afternoon I got another text from wholesaler #1 letting me know he tied one up and later I got a phone call from him on another house that he was trying to get locked up for quite some time, but the seller was pretty set at 10k higher than what he was offering him. The seller insisted that the property didn't need any work. He knew I was pretty familiar with this area so he ran the #'s with me and we agreed that based on the information we were being given by the seller we should be able to make it work, and he later on confirmed he was able to lock that one up as well with an inspection contingency based on the fact that the seller claimed there were very little to no repairs, which due to the age I knew was very possible.

Both houses are from Mailers.

House #1 Sqft: 970 Built: 1952

Purchase at 267k, repairs 28k, and ARV of 370k.

We will list this one ourselves so closing costs and commissions will only be about 4%-5%.

House #2 Purchase price 85k repairs 5k

resale price $115 10% closing costs/commissions. (11k) after some small holding costs (not including money cost) we will be at about our 13-14% return for the entire capital invested. after holding costs of 3-8% on capital borrowed (depends on if we use hard of private money) we will only be left with a projected 8-10k. This may be an amount that most rehabbers wouldn't be willing to do this deal for but I would do deals like this ALL day long.

Weekly Wrap Up

That puts us at 34 total with 116 to go.

I spoke to my agent earlier today to see what is going on with him since he hasn't tied anything up recently. We discussed some additional things we are going to try to implement including more bandit signs, every door direct mail, we also talked about things he can have his assistant or someone else do to give him more time to focus even more of his time on acquiring properties.

My new lead gen site just went live last week and we will start to do some marketing with that later this week so we will see how that goes.

My new acquisitions manager is "failing fast" I've been listening to podcasts from BP and other house flippers as well as some I have interviewed myself and seeing what kind of things we can begin to implement including a driving for dollars campaign, probate campaign and doing better with getting all we can out of our returned direct mail.

On Friday I met with another potential wholesaler who reached out to me from from this thread who anticipates being able to bring us some good business. So far his first house looked like the ARV was inflated but he said it wasn't intentional and he will do a better job of screening what he sends us. He seems sincere but my experience is this is what most "wholesalers" do and not the kind I like to work with but we are going to give him one more chance.

Also trying to slowly purchase more homes in Utah and open up our Utah market, so working with a couple wholesalers there and been in contact with an agent who I use to play football with who is going to start helping us make some more offers and get more comfortable in this area. No major rush to grow too fast too soon here but another potential future deal source. Just spoke to my brother @Steven Williams this morning (who BTW just got paid his first 10k today on the deal we just closed on HUGE CONGRATS BRO! ;-)) and he agreed to do some hourly as needed work for us just as needed while we are still setting up our team in UT so that will be helpful to know we can have him as a go to person on an as need basis.

I don't necessarily anticipate that our averages will go up anytime in the next few weeks. At least not due to any of the new things we are beginning to implement, but like I said to my agent this morning, I am going to put in place whatever I can now that will allow us to buy more houses the 2nd half of the year and still allow us a chance to make our goal. Not to over simplify it but if I average 2 deals a week for the first trimester, 3 a week for the 2nd trimester, and 4 a week for the 3rd trimester then we will reach our goal. I told him I don't know that I will reach my goal of 150 a week but I do know that by trying my hardest I will end up buying more houses than I would have, so I fully intend to still do everything I can to try to accomplish that goal!

Thanks again for the support AND Accountability! :-)

Thanks @Attila Bertalan Really appreciate the feedback and encouragement!

@J Scott Hijack away! I really appreciate the feedback. Any additional light or clarification that can be shared from other experienced flippers to help others learn is greatly appreciated. I am still learning as well so please keep it coming!

Completely agree that new investors should look at as many houses as possible. If you know someone who is a contractor or estimates repairs walking through 10-20 house with them or someone else who can help you understand repairs would be incredibly valuable and you would be surprised at how much you would learn! I remember the very first time I needed to know what repairs cost for a house. I met with 5 different contractors. Some were Generals and some were subs but I tell you what after looking through that one house with all 5 of them I learned a ton about repair cost and rehabbing a house! From there just deterring who was charing "too much" and who may even be charging "too little" happened over time after trying to figure out what was needed on several projects.

Then we got really fast and good at estimating repairs when we started doing trustee sales. Imagine analyzing about 20 or so houses every day for a couple years and estimating repairs on houses you couldn't even see the inside of and only had a about a minute to come up with only by looking through a window or pictures online (and that's if you were lucky)

Now that we aren't focused on Trustee sales we have actually had to retrain ourselves to realize that it is ok to try to come up with a more accurate repair bid and actually inspect properties :-) In fact although we come up with a quick estimate when making an offer we will still usually have our contractor do an inspection once we get an acceptance just to confirm we are all on the same page.

I think for most investors once you get your feet wet and get a pretty good idea of estimating repairs it is important to come up with a way to quickly determine repairs bc I don't know of may contractors who will want to walk through 100+ houses with you as you are still "learning" However you should use these "rules of thumb" only on your original estimation when making an offer and then you can sure things up once you get an acceptance to make sure you didn't miss anything.

Thanks again for the feedback and please keep it coming!

@Cliff Mccue Great question Cliff. BC I do a pretty high volume of houses we pretty much always have a property we can put them on. Depending on the investment amount and what we have available sometimes they are in first position and sometimes they are in 2nd position. There has been a couple times where we may not have had a property ready for them but maybe have one coming up in a couple days in which case they would simply get their money back through escrow when we close and then send funds again for closing of the next property. In these cases it is easier/better for me to just keep their monthly int. payment going bc rather than stop paying them and or mess up my accounting. I'm good with paying them on a couple days of interest to keep them happy and knowing they are getting that constant 12% annualized return and fixed monthly payment.

The way we do the transfer is my assistant tracks houses we have that are coming up to close and if we have a private money lender on that property she will find another house to use for the new collateral. She will contact out PM lender and confirm they are good with the new collateral. Then pretty much on the same day we reconvey their interest in the other property we record their new deed of trust on a new property.

When first starting doing higher volume it was harder work to keep this up, but even if they had their money back for a few weeks I was always working hard to keep it working so they would keep investing with me and not take it somewhere else. This has helped me retain most of the private money I have used in the past few years so I can continue to use again and again.

You bet @Christian Lautenschleger ! :-)

Thanks @Jill Banner ! Yes we use private/IRA funds all the time. We pay all of our investors 12% annualized return on their capital, and keep that capital working around the clock so they don't get it back 4 months out of the year and end up only getting 8%. In fact most of them are just set up on auto pay and get paid a monthly payment based on how much they have invested and then Vanessa will move them from property to property as we close on and buy other houses.

@Alex Bejenaru Thank you for your feedback, and glad you are enjoying the podcasts! Just like anything there is a lot more that goes into that kind of production than meets the eye so getting that kind of feedback really means a lot to me! Looking forward to hearing all about your upcoming success!

@Mike S. I noticed you are in LA. Not sure what kind of houses you are doing but if you are doing higher end finishes or have a bunch of "extras" you will probably be closer to $30 a sq ft on some of those houses, but I assure you volume is not the issue. In fact I could argue that by running a smaller operation you are better able to keep track of your expenses. It's not like I am shipping oversees to get work done or anything like that ;-) I'm not trying to tell you in anyway that you are wrong, just trying to let you know it can be done, but once again really depends on the materials you are using as well.

@Account Closed Spot on!

You bet @Timothy Riley !

@Henry M. Love the analogy! That will really help me next time I get get side swiped. I'll just keep telling myself "dysfunctional family" They don't really mean it! ;-) haha that really is a great way to look at it. and I really appreciate the kind worlds of support and encouragement!

@Mike S. We usually add about 5k for HVAC as an "extra" A couple windows is fine, doors included, little bit of termite damage is fine, little stucco repair is fine. Really obviously it is not an exact science. If you have to do ALL of the things you mention to a large degree like ALL of the windows a ton of termite damage, All the doors, and garage door, a ton of drywall and stucco and you are dealing with a border and a house with a ton of Crap in it then yes you would need to add for that! Also just to be clear this is just so we can start the ball rolling and get an offer out. If you are meeting with contractors and coming up with EXACT repair estimates on every house you make an offer on before you make the offer, you are going to spend a lot of time spinning you wheels on making offers on properties that you probably won't get anyway. Once we know someone is serious then we can crunch our numbers some more, but we are usually very close anyway. After a while you can just usually look at a house and know right about where it will be.

@Jessica H. Thanks for the feedback and glad you are liking it! I have a lot of fun with it and am getting a lot of value out of the relationships I've been creating as well so it's been time well spent. Not to mention the chance to improve my singing skills! I'm currently taking requests so let me know if you any ;-)

I want to be careful with how I answer your question bc of some of the comments I was getting earlier in the thread but I think we are mostly over that by now so hopefully I can be more open with how I run my business without feeling like I am walking on eggshells :-)

If you follow my site and podcast, you will know that I am very hands off so I haven't actually seen any of these properties so I can't answer your question 100% as far as to the specifics on exactly what we are going to do bc honestly I don't know regarding these exact houses. However I know what we do generally what we do and how we generally estimate repairs so hopefully I can give you the feedback you are looking for.

First off let me be clear that these properties are not in high end neighborhoods/areas that require high end finishes so that is part of the reason for the prices.

However in most of these houses we will put laminate wood flooring, ceramic tile, regular carpet (nice but not fancy) 2 tone paint, new basic baseboards, new basic stainless steel appliances, lower end granite, paint cabinets as needed, new vanities/mirrors as needed, replace all electrical and plumbing fixtures, new mid range blinds (cheap but not the cheapest) and very little landscaping. We keep what we can and of course it depends on the area and what comps we are comparing our ARV to. We want to make sure not to compare to a really nicely upgraded home and then repair it to a lower quality.

There are different "rules" we go by when estimating repairs but for the most part it costs us about $20 a sq ft to do what I call a full gut without the "extras" this includes new flooring throughout, new paint inside and out, new kitchen (nothing too fancy) new vanities/mirrors, baseboards, fixtures, blinds, cleaning, and just a little bit for the landscaping. Then if you need to replace any of the mechanicals, or roof, pool, major plumbing or major electrical, or pool work that is extra. Then you can take away for things you don't need to replace. So for example the utah house, it was built in 1992, and just by the year we can assume we will be able to save something whether it be tile, cabinets, outside paint, some fixtures, maybe vanities etc. so rather than it costing 22k for an 1,100 sq ft house, I know we can save about 5-7k and make it closer to 15k. Don't get me wrong I don't just come up with that on my own, and someone does look at the houses and I did see pics of this one which is why I know we can save some of these items.

Anyway I know that was a long answer but I wanted to make sure I answered what I think you were asking. Hope that helps!