Thirtieth Week – You Must Act Fast

Here is what happened during the Thirtieth week of documenting our flipping houses business on this blog. If you missed the first post explaining what I am doing, please visit this page: See How We Are Flipping Houses.

These are the things I did this week:

Note: I am still needing to provide before pictures and details on several of the houses we recently acquired and fully intend to do so this next week. This goes for the Flatulent House, the Perp House and the Audi House.

Got Moved (Mostly)

Got most of our stuff moved on Saturday. After years of drought we ended up getting a lot of rain all weekend. We needed it but we didn’t. The move went as well as any move does. I haven’t done that much physical labor in a long time and could feel it for days.

I wanted to thank my friends and family for helping with the move. Our mentor showed up to see the house right after we arrived with the moving truck. He didn’t know we would be unloading but helped with the entire truck load without hesitation. It is great to have such wonderful family and friends.

Next time we will be hiring movers. I say that every single move and we always end up doing it ourselves.

The reason I titled this week as ‘You Must Act Fast’ is because I put off returning some calls and website lead emails while we were moving for two days. All said and done, I know I missed out on one good deal and maybe two. I’m not going to beat myself up over it but we all need to realize the opportunity cost being missed when we try to save money by doing things ourselves.

I’ll never forget one of the biggest rehabs we ever did and it was one of the first ones. I’d had trouble scheduling contractors and ended up with a drywall crew showing up the next day and having nobody to prep the studs where we removed all of the old drywall throughout this giant house. There were nails everywhere and they needed to be removed. Not a big deal, but this was a huge house. There were some other small things needing to be done quickly as well, but none of it was rocket surgery. I just didn’t know anyone that I could hire to do the work on such short notice.

I ended up going over to the house to do the work myself. It was taking all day and I was very frustrated. Our mentor showed up and immediately gave me a lecture in a very irritated tone. No need to sugar coat it. I was missing out on deals that would make us thousands of dollars because I was busy swinging a hammer.

You have to realize where your time is best spent. I know you can’t or don’t always want to work on some things but there should be some effort to do this. This also gets into the good old 80/20 rule where 20 percent of the things you do produces 80 percent of the results. Work at focusing on those 20 percent of things.

I know a lot of investors like to do the repairs on the houses themselves and that is great. It just isn’t for me. If you figure out what your time is worth and if you can hire someone to do something for less than that amount, you should hire someone to do it. Easier said than done, but something to strive for and really think about.

The reason I hesitate to hire movers is that it seems packing and unpacking is where most of the time is spent anyway. Will I ever learn?

Got the Audi House Under Contract To Be Sold

The Audi House needed more work than I wanted to tackle right now with how many houses we have in inventory needing work and attention. An investor friend of mine was looking for another project and expressed interest in this house. He looked at it very quickly and met me to sign a contract at my asking price. This should be a quick wholesale. I will post the numbers after it closes in a couple of weeks.

The picture for this week’s post is from a house a couple streets over from this house. Too funny.

Found Another 2 Contractors

Found 2 more contractors. The first was a referral from a friend and the second was a referral from a Sherwin Williams store. I got several business cards off their wall there and also asked the sales rep if he reccommended any of them. He was new and didn’t know anyone yet and so asked his manager. His manager recommended a single contractor. I invited him to give a bid on the Flatulent House. He came in right at what I was figuring the job should cost. Just have to wait for the foundation to be leveled in the front and he can get started.

The other contractor is a painting contractor that does tape/float/texture as well. He did a small job for me at the new house and did an excellent job quickly and for a good price. I will have him do some work at our old house.

Def Leppard House Under Contract To Be Sold

Don’t think I’ve mentioned it but we’ve had the Def Leppard house under contract for a couple of weeks. Inspection has been done and minor repairs have been made. The only things they wanted fixed were a running toilet, the stinky garage (pet smell), and a couple doors that had phantom swings. They also wanted the AC serviced. We should be closing this sale within in a couple of weeks and will provide the final numbers at that point.

Strong Smell At the Perp House

Checked on the Perp House yesterday to make sure all was well while it was sitting there waiting for me to get to it. The house was fine but there was a strong smell coming from the hall bathroom. Immediately, I knew where it was coming from and I hesitatingly lifted the lid to the toilet with a pen I found on the floor. Yep. Just as I suspected. Full of everything. Very disgusting. I turned the water on to the toilet and gave it a flush (with the lid down, because I did not want to deal with any suspense induced with watching the nasty water slowly rise to the brim. I’m getting shivers just thinking about it while typing this.

It did not overflow. Thank God. I then flushed again for good measure and thought all was well. Just to check, I lifted the lid again and noticed the water swirling around at the top of the bowl. Everything still there and the smell spewing even more strongly because of the disturbance. Gross.

Called up my trusty old contractor that we were having problems with. Old habits die hard. He immediately showed up, grabbed the plunger and went to town. This guy was crazy. The sewage water was splashing everywhere and he was just ramming that plunger in there without any concern for the water splashing out and very near to him (I’m sure he got a little on him.) I was standing a good 10 feet away mainly because the wall of stink held me back.

The joys of rehabs and what others leave for the new owner. Not my idea of a good house warming gift. 🙂

Marketing

Total Motivated Seller Leads This Week: 15

Leads Analyzed

1. Private Lender Foreclosure[Source: Website]

   Lender wants to sell a 3 bedroom, 1 bath, 1200 sf house in a so-so neighborhood.

   Here are the numbers:

   Asking Price:	Make An Offer
   Amount Owed:	$0
   Repairs:	Quite A Bit (unconfirmed)
   After Repaired Value:	$60,000
   Max Offer:	35,000 – repairs

   Private lender foreclosed on someone that bought a house with owner financing. The lender was from out of town and just wanted to recoup his money. Unfortunately, I was busy with the move this weekend to jump on this one as fast as I would have liked and another investor got it. Hate when that happens. 🙁 This is why you need to do your best to visit houses as soon as possible. Do not put it off.

2. Does Not Want To Commute So Far[Source: Website]

   Homeowner wants to sell a 3 bedroom, 2 bath, 1600 sf house in a good neighborhood.

   Here are the numbers:

   Asking Price:	$150,000
   Amount Owed:	$?
   Repairs:	Nothing (unconfirmed)
   After Repaired Value:	$150,000
   Max Offer:	$97,000 – repairs

   Seller lives pretty far outside of San Antonio in a retirement community and wants to sell to avoid her commute. Guess she is not yet retired.

   She started in with how nice the house was and every little detail about the house that she felt set it apart. These are almost always a waste of time. I began to tell her that I would not be interested after she told me she wants what it has been listed for for the last 3 months. $150k. It doesn’t need repairs. She kept mentioning that the house across the street sold for over $200k and that hers was nicer. Why hasn’t it sold yet then? It’s really as simple as that.

   Then came the “It appraised for X back in 2007.” Do I need to even say anything here? 🙂

3. Headed To The House[Source: Drive For Dollars Letter]

   Homeowner wants to sell a 3 bedroom, 2 bath, 1500 sf house in a good neighborhood.

   Here are the numbers:

   Asking Price:	Make An Offer
   Amount Owed:	$0
   Repairs:	Everything (unconfirmed)
   After Repaired Value:	$90,000
   Max Offer:	$58,000 – repairs

   I got a message on my phone from a call made to me over the weekend while I was moving. The seller mentioned he was on the way over to the property and felt it would be a good time to meet and discuss selling it. This is the first contact with this seller. Did not get that message for a couple of days and called to see if we could reschedule. Still in progress. He did mention that his son was living there and was “fixin’ it up real pretty”. I won’t get my hopes up.

4. Wholesale[Source: Wholesale]

   Homeowner wants to sell a 2 bedroom, 1 bath, 1000 sf house in a decent neighborhood.

   Here are the numbers:

   Asking Price:	$54,000
   Amount Owed:	$?
   Repairs:	Says $10k (unconfirmed)
   After Repaired Value:	$80,000
   Max Offer:	$50,000 – repairs

   Wholesale house that is priced just a little too high. I told him that I would be in the $40’s and he will let me know if he does not get any other offers close to what he wants.

5. Moved In With Daughter[Source: Website]

   Homeowner wants to sell a 3 bedroom, 2 bath, 1000 sf house in a so-so neighborhood.

   Here are the numbers:

   Asking Price:	$45,000
   Amount Owed:	$0
   Repairs:	Cracks Patched, Updating (unconfirmed)
   After Repaired Value:	$70,000
   Max Offer:	$45,000 – repairs

   House has been leveled but still needs the cosmetics done. Seller just doesn’t want to mess with the house anymore. I need to make sure there is not a more serious issue with the foundation that is causing the desire to move. Waiting on scheduling for this one.

6. Missed Out[Source: Website]

   Homeowner wants to sell a 3 bedroom, 2 bath, 900 sf house in a so-so neighborhood.

   Here are the numbers:

   Asking Price:	$35,000
   Amount Owed:	$0
   Repairs:	siding and foundation (unconfirmed)
   After Repaired Value:	$70,000
   Max Offer:	$45,000 – repairs

   Tenants are moving out and don’t want to mess with it. The asking price was good and could probably have made this a deal had I been able to jump on it. Of course, the foundation could have been horrible. Who knows. They already have it under contract.

7. Divorce[Source: Website]

   Homeowner wants to sell a 3 bedroom, 2 bath, 1500 sf house in a good neighborhood.

   Here are the numbers:

   Asking Price:	$60,000
   Amount Owed:	$60,000
   Repairs:	Roof,Foundation,Cosmetics (unconfirmed)
   After Repaired Value:	$125,000
   Max Offer:	$81,000 – repairs

   Divorce situation and the seller is asking for what they owe. Seems quite motivated so I’ve scheduled to see it.

   Update: The house was not that bad. Leveling is definitely needed. The problem lies with the seller. She is super ready to deal but is not on speaking terms with the ex. He seems nice but is not sure about selling for what I need to buy it for.

   There is also another investor competing with me on this one and he made it there first. I am still working on this one.

8. Needs Cash[Source: Website]

   Homeowner wants to sell a 3 bedroom, 1 bath, 1200 sf house in a not-so-good neighborhood.

   Here are the numbers:

   Asking Price:	$30,000
   Amount Owed:	$0
   Repairs:	Everything (unconfirmed)
   After Repaired Value:	$50,000
   Max Offer:	$25,000 – repairs

   Seller needs cash. This could be worked into a deal but is in an area I don’t care for. So, I birddogged this lead.

9. Too Much To Keep Up With[Source: Website]

   Homeowner wants to sell a 2 bedroom, 1 bath, 500 sf house in a bad neighborhood.

   Here are the numbers:

   Asking Price:	$15,000
   Amount Owed:	$0
   Repairs:	unknown (unconfirmed)
   After Repaired Value:	$35,000
   Max Offer:	Not For Me

   This one is in a rough area, needs lots of work, is super tiny….got birddogged.

10. Tenants Tore Up[Source: Website]

    Homeowner wants to sell a 4 bedroom, 2.5 bath, 1400 sf house in a decent neighborhood.

    Here are the numbers:

    Asking Price:	$73,000
    Amount Owed:	Would Not Say
    Repairs:	A Lot (unconfirmed)
    After Repaired Value:	$90,000
    Max Offer:	$58k – repairs

    Seller had tenants in the house that completely destroyed it. She does not have the financing or patience to fix it back up and rent it out again.

    This one is near the Flatulent House and I knew I would want this one for around the same price that I bought that one. So I gave her a ball park figure of $45k. I did this because she would not tell me how much she owed and just didn’t seem like her motivation level was where it needed to be. She immediately told me that wouldn’t work. I will follow up.

11. Too Far Out Of Town[Source: Website]

    Homeowner wants to sell a 4 bedroom, 3 bath, 2800 sf house outside of San Antonio.

    Here are the numbers:

    Asking Price:	$250,000
    Amount Owed:	$220,000
    Repairs:	cosmetics (unconfirmed)
    After Repaired Value:	$?? probably around $250k
    Max Offer:	Not For Me

    Seller wants to move closer to San Antonio to be closer to her kid’s school. Too high priced and too far out for me. Next.

12. Rental Townhouse[Source: Yellow Pages]

    Homeowner wants to sell a 2 bedroom, 1 bath, 1000 sf house in a bad neighborhood.

    Here are the numbers:

    Asking Price:	$40,000
    Amount Owed:	$0
    Repairs:	cosmetics (unconfirmed)
    After Repaired Value:	$35,000
    Max Offer:	Not For Me

    This would be a good deal for a landlord. I would probably contract this one to wholesale if I had a little more time. Birddogged it instead.

13. Vacant Lot[Source: Yellow Pages]

    Homeowner wants to sell a vacant lot in a not-so-good neighborhood.

    Here are the numbers:

    Asking Price:	$6,000
    Amount Owed:	taxes (several hundred)
    Repairs:	It’s Dirt
    After Repaired Value:	$6,000
    Max Offer:	$2,000

    Vacant lot. I would buy this if I got it cheap enough. What I would probably do is sell it with owner financing. I offered him $1,500.

14. Needs More Space[Source: Yellow Pages]

    Homeowner wants to sell a 2 bedroom, 1.5 bath, 1000 sf house in a decent neighborhood.

    Here are the numbers:

    Asking Price:	$83,000
    Amount Owed:	$82,000
    Repairs:	AC and Cosmetic
    After Repaired Value:	$75,000
    Max Offer:	$48,000

    Seller needs more space and cannot afford to sell the house the conventional way. Not enough equity. I cannot help either.

15. Las Vegas House[Source: Website]

    Homeowner wants to sell a 3 bedroom, 2 bath, 1700 sf house in Las Vegas. I do not buy outside of San Antonio. His asking price is $180k. If you buy in Vegas and this sounds good to you, let me know.

Summary

Working to get houses either sold or rehabbed and on the market. I will start shifting back to more marketing as the work is started on the houses. Will probably send out some postcards this week.

Plans For Next Week

• Finish Moving.
• Mail some postcards.
• Get contractors started and/or work at wholesaling some houses.
• Post about the houses we recently bought.

Please ReTweet and Like this post because it’s the nice thing to do and I truly appreciate it.

-Danny

“In anything at all, perfection is finally attained not when there is no longer anything to add, but when there is no longer anything to take away.” – Antoine De Saint-Exupery

Thank you for following along with us on our adventures in flipping houses. We hope you are enjoying it and that it is helping you to learn how to flip houses or improve your house flipping business, whatever the case may be.