Episode 13: The 12 Truths of Rehabbing
December 16, 2015
The truth and nothing but the truth! I’m sharing 12 myth-busters for real estate rehabbing including anyone can do this and it works in any market regardless if the market is up or down (if done right -of course). I touched on this topic in Episode 3 but want to dive deeper for your benefit because this stops many from being successful…
Show Notes
1 “Flipping” houses is legal and ethical
- Don’t let anyone tell you otherwise
- Solves motivated seller problems
- Care for neglected repairs
- Improves the neighborhood
- Transforms lives
2 It’s A Good Thing for All
- For the seller
- For the buyer
- For you
- For the neighborhood
3 Works in any market
- Done right works in up or down markets
- Right approach works anywhere
4 Your make money when you buy, not when you sell
- Most people think you make your money when you sell and hears why
- Word of caution with this mindset
- Instead focus on… 70% ARV Rule (deep dive on this rule… later episode
- Profit driver is discount from FMV
5 Buy at intrinsic value of the investment
- Replacement cost, different than current value
- See each opportunity for what it realistically can be
- The value of the skill of how to visualize an ugly duckling into a prince
- Be objective
- Stay true to your numbers and formulas
6 Rehabbing is not a gamble
- Risks with every property
- Know your market & property
- Speed
- Singles – not swing for the fence
7 Keep it simple
- Especially on your first one
- Multiple simple ones better than one complex
8 Know your worst case scenarios
- Murphy’s law – be prepared
- Don’t be negative but consider the worst
- Know what to expect, react quickly
9 Know your exit strategy
- Buy, rehab, sell – the first is great but then what?
- Know what you’re going to do before you buy
- What to sell for, when and how
10 Rehabbing houses is a people business
- Your reputation is far more valuable than any one deal
- The relationships you build, build solid ones, reap the rewards
- Plant seeds, nurture, harvest…. The Word says…
11 Anyone can do this
- With the right approach
- With the right guidance (e.g., mentor or coach)
- With the right team
12 Have the Right People on Your Team
- Right information
- Right realtors
- Contractors
- Mentors
- Begin prospecting for your team now and always