Here’s some breaking news for you guys- as of yesterday, the Gov has released the ‘No Flipping Rule’ on FHAs! Yup- that’s right!  In order to spur more buying activity and property values, they are allowing investors to purchase foreclosed homes and flip them immediately! This will be in effect for 1 year. The previous ruling from 2003 said if you purchased a foreclosed home, you had to wait 90 days before securing it with FHA financing. Not anymore- they’re trying to get the glut of inventory sucked up and off the market now.  Here’s the article from CNN.

Here’s another rehab deal for someone to pick up, fix and flip, or hold as a rental! There’s plenty of equity to make it a smokin’ deal! Medium rehab required- check out the video walk thru!

2215 W Roeser Rd, Phoenix, AZ 85041
Price: $88,000

I have an opportunity to bring you REO’s at 50% of their appraised value. These are all homes worth a MINIMUM of $50,000, but you’re buying them for $25,000. They are GUARANTEED to appraise for a minimum of $50,000 or the bank will trade it out for a different property. These are all over the country. Here’s the fun part, we’ve had homes that appraise for $75,000 to $150,000, yet you still only pay $25,000. What a great deal! Where else can you buy homes for $25,000 at 50% of their GUARANTEED Appraised Value? I challenge you to look- you won’t find it. Sure there’s lists out there, but who’s going to GUARANTEE their value, and agree to switch the home out if they appraise for less than $50k? No one…  Not only that, but I’ll teach you how to flip these houses for some quick and easy profits, if that’s what you’re looking to do! You can be in and out of the deal within weeks, with a nice, hefty profit to boot. Roll those profits into more of these properties for a RAPID GROWTH in your portfolio! If you are interested, contact me IMMEDIATELY before this opportunity is gone.

ok- I’m going to throw together some quick numbers for you guys on this new deal in the West Valley. These are rough estimates, but, if you’ve done deals in the past, you’ll see it’s fairly accurate.

Let’s say this Investor flips the deal to you at $130,000 (remember, it appraises for $210,000 or more). Here’s how I see the numbers playing out.

You’ll list it on MLS for $190,000. Yes, it’s worth $210,000, but in this market, you want to list it cheap to get them to sell fast!  This is NOT the market to get greedy in! Here’s some figures…

    $190,000  - Sales price on the back side
    - $11,400 - Realtor’s Fees (assuming you pay a full 6%)
   - $2,500 - Title/Closing Fees (again, over estimating)
   - $10,000 - Rehab/repair costs (paint, carpet, etc)
   - $12,000 - Holding Costs (using Hard Money, credit cards, utilities, etc)
 
Sub-Total = $154,100.  Take out the $130,000 you paid for the property (maybe another $2k in closing costs on the purchase) and you get…

$24,100 NET PROFIT

Now, doesn’t that sound decent? Not too shabby for one slam dunk deal. Or, you can hold it as a long term rental for easy cashflows. There’s soo many ways to work deals, it’s not even funny. Contact me if you want to pick up some deals yourself.

I locked up another deal under contract today. At the request of my buyer/investor, I can’t say too much about this deal in the moment. It’s in the West Valley, appraises for $210,000 or more. We got it under contract in the $120’s.  House is in pretty decent condition, not too much rehab needing to be done (paint, carpet, etc). The buyer will most likely flip it to another investor for a very quick and easy profit. I’ll keep you guys posted once it closes escrow…

I got a call from a competitor friend of mine about a deal he just landed. It’s always tough to work a deal from a competitor, but at the end of the day, it doesn’t matter where it comes from. All that matters are if the numbers work, and they certainly did in this deal. So I jumped on it. It looked like it would be a challenge, one I haven’t had in quite some time.

It was a 3/2, 1329 sf brick home, built in the 1960s. I typically never touch these older homes, but- it was less than 1/2 mile from Arizona State University, and the Fall Semester would be starting within a few months. I knew I had to capture the market for college kids, staff, or parents who would be purchasing this home. I figured most likely it would be parents buying it for their kids while in school, an investor looking to rent it out to college students, or young professionals who work in the area. It was about 1 mile from the freeway, and central to activities/restaurants, banks, etc. This thing had some potential to sell quickly, for a fair price. I had comparables in the area in the $250-270k range, depending on the upgrades in the home. I was shooting for $270k, yes, even in THIS market.

The house definitely had some problems. The roof was trashed, yard dead, single pane windows, broken doors, etc. The worse part was the family who had lived there for 13 years raised Chihuahuas. Yes, 13 of them, living in the home. It was THE MOST disgusting house I had seen out of the 200+ deals I’ve done. We found dog feces up underneath the kitchen cabinets (yes, under the base of the cabients- how the dogs got in there, WHO KNOWS!). The plumbing was backed up in certain areas, and this place was a dump. The biggest problem was that they had laid 4" Spanish tile throughout the entire house. Kitchen, bedrooms, closets- they even used it for baseboards! Oh, and the pop-corn ceilings. YUCK! The neighborhood wasn’t the best either- with vagrants floating through every couple of hours. This house backed right up to the back of a commercial strip mall too- with some fast food joints in there. The smell was horrendous from that alley! But, in this game, you have to see potential. Read the rest of this entry »

I have been engaging in a conversation over at the Arizona Real Estate Notebook about a kitchen remodel project. The original question came from a someone who needs to sell his home, and thinks the kitchen is outdated (he’s right!). It’s a 2300sf home in NE Phoenix (Tatum and Greenway), built in 1985. He wants to sell quickly, within a few months. The price range on the house is about $430,000. There’s no specifics on a budget, but I’m thinking somewhere in the $5-7k range is about right.

How would I flip this kitchen? Easy. The first thing Rob needs to do is go visit all the new home builders in the area. Looking at houses in the $500-550k price range should do it- with all the incentives builders are offering, it brings the purchase price down to the mid $400’s. This is his main competition. Most people want new homes, but buy resale due to price and/or location (some don’t like brand new subdivisions, and resale offers mature landscaping and proven HOAs). Next, Rob needs to have his Realtor® show him pictures of all the houses that have SOLD within the last 3 months in his area. This will not only give him a good idea on pricing, but have an idea of what the kitchens look like that people are buying into. Lastly, looking at Active listings could help somewhat. This is a good point of reference, but- keep in mind that these are all the ones that no one else has wanted yet. So take their kitchen designs with a grain of salt- Sold kitchens weigh more heavily on Active Listing Kitchens (however, Active Listings are your competitors as well, so keep them in mind). This should give him a strong idea of what needs to go into his kitchen.

Now, the question was asked as to what I would do to flip this kitchen. Personally, as someone who has flipped a couple hundred homes in the last few years, I would offer the most kitchen for the money. This means upgrades! You have to keep in mind the price range of home, and location. The buyers in this area are Scottsdale buyers, and expect quality. Especially if they are going to buy a 23 year old home for $430k. Quality sells- not cheap knock offs. People in this price range know the difference between quality and skimming. Give them the most quality for their buck.

The first thing that jumps out at me are the small, white tile counter tops. We all think the same things when we see them- public restroom. They have to go. He was thinking of doing granite tile counter tops for the price of about $3k. I think that’s a little high. Without seeing the kitchen or having actual measurements, I am just going by the picture you see here. My granite guys are quite a bit cheaper than anyone else out there. I believe he could have granite slab done for his $3k, and granite tile for even less. To me, slab is the way to go. There are other alternatives out there, for quite a bit cheaper- Lowe’s and Home Depot have a good selection of these. Avoid going with anything too ‘plastic’ looking. People want quality, and plastic isn’t quality. Granite tile is a cheaper alternative- but in that price range of home, and the current state of our market, I would only put in slab, plain and simple. Oh, and leave the bar top- families love the bar top. Read the rest of this entry »