All Forum Posts by: Ritch Bonisa

You've picked very good markets!

You might look into the Fishers or Noblesville areas.

I agree with @Kent Ritter.  It is very difficult to beat the locals without working with someone that has a good deal of local knowledge. The other thing is the FACT that just picking properties that are listed doesn’t usually cut the mustard. It’s best to have someone who operates in the “listed” arena, AND the off market arena. Off market properties can be terrible once a few of the bad wholesalers get ahold of them. Just way over priced and make no sense. It can be very beneficial to know an investor who actually purchases properties, takes title, and is willing to sell. Someone who sources properties directly from owners, instead of picks up contracts, and/or, just sends out other people’s deals with a markup. I’ve had wholesalers try to sell me a property that I already own, and try to mark it up over 40k. We all know that your deal is based on the purchase price. It’s the initial difference between success and failure.

This is kind of a sidebar, but when you figure your return make sure you figure it on the amount of money that you put in personally, not on the loan amount.  This will represent an actual return on YOUR investment. Many investors don't figure it this way.  Maybe I'm just stating the obvious, but I've seen many figure it on the full amount and not their investment. Looking at it the the right way can change the way you make decisions. 

IMO you don't want to spend too much time trying to vet the wholesaler.  Each and every property and deal needs to be vetted.  

Most wholesalers are going to get a property under contract, then add a ridiculously high fee, and then email blast it out to anyone and everyone.  

As buyers this doesn't do us any good. This can end up putting us in a situation where there may be a lot of competition for the property and it forces us to move so quickly that we have to make decisions before we can property evaluate the situation.  It's just a bad method. 

The ideal situation is to be connected to someone who sources their own properties.  They take the time to understand what you are looking for and what you need.  They actively look for properties that fit your criteria, meaning they are trying to find YOU a property.  Obviously, they need a cut on the deal too, which works very well, as long as it is reasonable.  

Someone actively looking for YOU, who will make YOU the first call when they find a property that fits. 

This is a great thread.  I love this!  It proves that excitement doesn't improve returns.  Making good decisions and being informed improves returns.  The BP Community really helped here. That's what it's all about!  

Good job @Asa Ifill and best wishes on the next one!

@Justin M.I think you have to weigh market vs. human capital.  You can have the perfect market, perfect systems, but the human factor will be large. IMO the answer lies somewhere in the middle. 

Maybe there is a market where you have some connections already and have some people who can be your eyes and ears on the ground.  Look into a market where you have some sort of asset or connection like that.  Use what you have available to you. 

Maybe even try to do all of this within an area that is a 4-5 hour drive for you, so you can monitor, be a little more hands on, and work at developing systems. 

It still all boils down to one simple fact. You can have a great market, great financing, great people to work with, etc., but in the end there is still some degree of risk/reward involved. What is the best way to mitigate risk and reasonably maximize reward? 

@Paul Volk

This is a great question, and for some people these things can make a huge difference.  

I actually have a system that does exactly this.  Problem is - it's not available in your market and/or without a boots on the ground approach with it. Use it on every project, personal and business. 

You can do exactly what you are talking about, but you have to do it piece meal and you can use something like DocuSign. Sure, it's a little more difficult, but you can make it work.  Updating an electronic scope of work would have to be some sort of a shared document somewhere in cyberspace. You can do it - get creative with it.  Hopefully your contractor or whoever you work with is knowledgeable, reliable, and will use your system.  At the end of the day, your systems are only as good as the people using them, (or not using them).

We developed our own.  Wrote our own code, etc.  So ours is very specific to our needs.  You can pull something together that meets your own specs.  

Just like you guys, I am really interested to hear what others are doing to bridge some of these issues. 

@Kevin Hoff

Obviously you need to be able to vet your deal and perform due diligence.

That said, you need:

• Boots on the ground
• Someone that will look for properties that fit YOUR criteria.
• Have your financing in line to move quickly. The good deals don't last long. 
• If you're all cash or mainly cash. You can purchase off market. Traditional finance works OK for properties that are listed MLS/BLC.
• You need patience.  Learn the market so you have the ability to act quickly. Being uninformed and trying to make quick moves can cause major problems very quickly.  
• Then there are the questions of strategy.  Distressed property, rent ready, etc. what are you looking for.

Hope that helps.

@Nick Wilson I see BRRRR properties all the time, but usually they are off market.