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Finding fix and flip opportunities

Finding fix and flip opportunities

Finding Fix and Flip opportunities A few years back, it was pretty easy and profitable to do “cosmetic” fix and flips, but due to rising prices and “seller” markets, this is no longer the case in most areas.  That means successful developers must find other strategies for creating value in their real estate business.  We think one of the best ways to “add value” is to develop a strong sense of where the right amenities can be added to a property.  In this article, we will discuss ideas that have worked well for us. The most common ways to add value are to create spaces that were not previously in the house (at least not on the tax records).  We have found ways to create master bedrooms by finding adjacent spaces to a room that we could then use as a master bathroom.  An unnecessary alcove in a kitchen allowed us to do just that in one remodel.  In our Victorian project, we used a large storage space behind a wall to create an upstairs bathroom.  Our Victorian was also a project where we took a downstairs basement and converted it to a bedroom.  In another project, we are reconfiguring an unpermitted space to add a master bedroom/bath and a 1/2 bath (we have to move the existing bathroom to do it).  The point is that you should get creative when walking properties, so that you can pick up on these value add ideas that others might miss. Sometimes the best way to find these spaces described above is to look for them in houses that have bad layouts.  Bad layouts...
Finishing Ideas for home remodels

Finishing Ideas for home remodels

Finishing ideas for home remodels As a remodel project moves toward completion, there are lots of small decisions to be made which can have a big impact on its success.  For our current Berkeley Victorian home, we are making decisions on everything from paint colors, cabinet handles/knobs, mirrors, lighting and landscaping, to name a few.  This is where you can really make the property pop and add the so-called “sizzle”.  It is also where it is worthwhile to get professional help and opinions, unless you are (or aspire to be) an interior designer.  I’ll share some basics about my formula for success. If you enjoy making design choices on your own, there are plenty of on-line resources to help you along the way.  Two of my favorite “idea” websites are Houzz.com and Pinterest.com.  Both sites have search engines, so you can really narrow down the description of what you are looking for (ie Victorian front doors).  If you already have a good idea the style you are looking for, major sites for home products make it easy to browse for specific items, including Home Depot, Lowe’s, Amazon and Overstock.com.  Often times it is a two-step process, starting with finding the style and then going to these individual stores to locate the specific products. For the Victorian, we went thru several iterations on exterior paint colors, since these homes are generally very colorful and leave a lot to the creative mind.  The interior paint remains the same color as I have done on all my recent homes, since I love the color scheme, it’s easy to use over again and...
Commercial Real Estate Investing Basics

Commercial Real Estate Investing Basics

Commercial real estate investing basics (part 1) For most investors, the path to success in real estate begins in single-family homes.  This is logical because of our familiarity with growing up in a home, as well as the “perception” that it requires less financial means to buy a home vs commercial asset.  But spend much time around the most successful investors, and you will find that most participate in commercial real estate transactions at one level or another.  The reasons to invest in commercial assets are many, but can be boiled down to these 2 basic factors: 1. the ability to scale and grow your wealth fast 2. strategic opportunities to significantly force appreciation over time.  Due to the interest in this subject, we will do a 6 part series on commercial investing basics. The 1st step in commercial investing is to determine what type of asset class you will pursue.  The general classifications are multifamily, office, retail, hospitality and industrial.  Additionally, there are many niches and sub-classifications, such as student housing, mobile home parks, self-storage, etc.  Each one has it’s own risk profile and generally does better (or worse) depending on where we are in the market cycle.  So let’s talk about risks and market cycles…. As a rule of thumb, multifamily is generally regarded as the lowest risk investments because people “need a roof over their head” no matter where we are in the economic cycle.  The same cannot necessarily be said for a retail store during a recession. If you look at the progression of commercial real estate values coming from the bottom of a market cycle,...
Kevin Bupp interview with Mark Gagner

Kevin Bupp interview with Mark Gagner

Kevin Bupp interview with Mark Gagner Recently I had the pleasure of being interviewed by Kevin Bupp, who hosts a nationally syndicated iTunes podcast called “Investing for Cash Flow”.  There are a lot of real estate podcasts out there, most of which focus on fix and flips or wholesale, but Kevin Bupp believes there is a smarter way to build wealth.  On the Real Estate Investing For Cashflow podcast, you’ll learn firsthand how the most successful commercial real estate investors in the world have learned to leverage their multifamily and commercial properties to create a steady stream of passive income. Enjoy my conversation with Kevin, as I share my story about creating passive income from active income…....
How to find good contractors

How to find good contractors

How to find good contractors Finding good contractors is not always easy.  In fact, most rehabbers will tell you that it is one of the biggest ongoing challenges in their business.  Even a contractor that starts out good may not perform so well after multiple jobs.  In this article, we will explore various ways to go about meeting potential contractors for your rehab projects. In future articles we will talk about what questions and criteria should be used for selecting the very best ones. The most obvious way to find good contractors is to constantly be asking for references from anyone that might be knowledgeable about the subject.  The best starting point is to ask the most successful active rehabbers in your market.  I guarantee you they have many stories about the good, the bad and the ugly.  Generally speaking, if you have helped these people in their business, they should be happy to share resources with you too.  These people can be found at your local REIA’s, so make sure you are attending them regularly and effectively networking.  Real estate agents and brokers are also a great source for contractor leads, particularly if they specialize in property types that might have a greater chance of needing work.  I like to network with agents and brokers that have significant experience and track record with REO’s, short sales, distressed properties, probates and tax lien properties.  Not only can they find you great deals in many cases, but they also know contractors from their time on the job.  Insurance agents, property managers and title officers are all in the business and may have...