realtor's perspective on finding a good fix and flip property
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A Realtor’s Perspective on finding a Good Fix and Flip Property and Developing a successful relationship with YOUR Realtor!
• Introductions • How to Find and Evaluate a Good Fix
and Flip Property.• How to develop a successful relationship with your realtor?
• Q & A • Thank You
Agenda
• Location , Location, Location
Corner lot, busy intersection, near commercial, apartments
• Know your SchoolsAPI (Academic Performance Index) Scores based on 1000 points. i.e Cupertino 900+
• What drives people to the community?
Is it schools, charming downtown, community spirit, larger lots?
• Know the style of the neighborhood and community.
Are you planning a contemporary style home in a Mediterranean or traditional neighborhood?
How to Invest and Evaluate a Flip in the Santa Clara Real Estate Market
• Tear Down – New construction potential to be best home on the block or are there other newly built homes within a ¼ mile radius? Time involved in building; what will the market be like when project is completed?
• Remodel – Quick turnaround and better opportunity to time hot market or does project extend beyond completion date because of many unknowns that require more work and expense.
• Vacant Land – How much additional costs involved vs. tear down or remodel, plus time?
Different Types of Fix and Flip PropertiesTear Down, Remodel or Vacant Land?
Tear Down
2431 Plummer Ave., San Jose$674,000.00 Sold 02/08/2012
2431 Plummer Ave., San JoseWork in progress!
Tear Down
1931 Cabana Drive, San JoseSold - $820,000.00 – 3/31/2012
1931 Cabana Drive, San JoseSold - $1,650,000 – 8/23/2012
Remodel
2517 Gerald WaySold $767,000.00 – 08/30/2011
2517 Gerald Way Sold $1,183,000.00 -05/17/2012
Remodel
2575 Richland AveWillow Glen
Sold - $757,000.00 5/31/2012
2575 Richland AveWillow Glen
Sold - $1,165,000 – 09/10/2012
Vacant Land
21216 Bank Mill Road, SaratogaSold $885,000 – 12/21/2005
21216 Bank Mill Road, SaratogaWork in Progress! Approx $4M
How to Find the Good Fix and Flip Property?
Budget
Goal Rental Remodel Sub-division
San Mateo - Gilroy
Areas
Ouch!2498 Westgate, Willow Glen
Purchased for $1,3M in 2007; sold for $1,835,000 in 2009. Originally on market for
$2,975,000.00
1715 Willow Street , Willow GlenPurchased for $500,000 in 2005; sold for $1.600,000 in 2007. Originally on market
for $2,095,000.
• Check recent sales for past 3-6 months within the same neighborhood and or comparable. Usually within a ¼ – ½ mile radius
• Compare apples to apples.. Lot size is important as well as age of home.
• Know the neighborhood and style. What type of materials are preferred.
• Evaluate floor plan – Will it appeal to a majority of buyers or is it too specific.
• Size of home and available yard. Again, know your neighborhood. Important in Willow Glen, maybe not in Mountain View
• Select neighborhoods that are customized versus tract style housing.
• Marketability – When will the home be complete?
Comparable Sales
RealtyTrac
FlipComp
Loopnet
Future Coldwell Banker App
Various Software Programs
Deal Breakers!• Multiple Offers
• Extensive Repairs
• City and Building Restrictions
Market Trends For Q1 – Santa Clara County
Market Trends For Q2 – Santa Clara County
What is the Value Add?
• Project Management Skills • Resources – Contacts within City/County Planning,
Stagers, Designers, Networks with other Agents, trade recommendations such as contractors, painters, landscapers, etc.
• Team Player –Communication from all parties. • Provides necessary information to client/investor such as
comps, school scores, neighborhood pros and cons.• Honesty – Is this truly a good project with projected ROI. • Marketing – MLS, On-Line, Internet and Real Estate Sites.
Get your Realtor Involved!
Use your Realtor as a resource
Understand the market .. Is it competitive?
Will there be multiple offers? Has the property been on the market a while?
Can you negotiate?
Research Property
Long Escrows!
How will market activity be when the project is complete and predicting exit value?
Challenges
Cash
Traditional Financing
Private Lending
Cash Auctions and Challenges
Financing Projects and Auctions
Thank You!
Ruby FooteColdwell Banker
1712 Meridian AvenueSan Jose, CA 95125
http://rubyfoote.com
Amy Paris 4 Square Development Co.,
Inc1155 Memorex Drive
Santa Clara, CA 95050 408-390-0343
[email protected]://4squaredevelpment.com