From 'A&E's Flip This House' to You!

[photopress:REIA__Image_Download__flip_this_house_logo_jpeg_from_mhv_reia_1_.jpg,thumb,alignright]Have you been watching the current real estate market and wondering how  to find the pot of gold in it? Fix and Flip guru Than Merrill from A&E’s Flip this House will show you how right here in Seattle on October 11. Than, like many other saavy investors, is building his business taking advantage of sellers in trouble.  Even though Seattle seems to be somewhat insulated from the current trend across the nation, there are still great opportunities to grab up distressed properties. Banks are looking to unload properties as are many homeowners on the brink of foreclosure.  These often become the inventory and raw product for the ‘fix and flippers’. But how do you find these elusive properties?

My husband and I have been involved with about 2 dozens ‘fix and flip’ properties, but finding the right properties at the right price, i.e., below market, is a challenge. As a realtor, I live and breathe the mls, but once a property hits the mls, it’s generally going to be sold at retail, and paying retail is not the way to make a profit on a ‘fix and flip’.

There are several real estate investment groups in the Puget Sound area that will help you get started and offer advice in marketing, legal issues (recently, state law passed requiring a flip in less than one year to require a contractor’s license.  More about that later) and tips of the trade. Says Shirley Henderson, President of REIA, ” flipping is profitable and a lot of fun if it’s done right”.  And the members want to help you do it right.  Usually they have monthly meetings and from time to time offer educational events to help their members. Members are happy to share their knowledge and are there to help each other.

On October 11, The Real Estate Investors Association of Washington (REIA) is hosting a fabulous Special Event straight from television land.  Than Merrill of A&E’s ‘Flip This House’ will be speaking at a this very low cost event ($15)  to show you how he and his team did 30 deals his first year and after that, double each year over the next 2 years.  The team has 260 deals under it’s belt at an average of $27,000 profit per deal.  $7,000,000 in three years, I could live with that!

If you’re interested in learning how he did it, join REIA on October 11 from 6-9pm to hear about Than’s systems and marketing to find those distressed properties and fix them for the best financial return.  This will be my first ‘fix and flip’ seminar and I’m anxious to hear from the best. Of those 2 dozen flips my husband and I have done, we’ve had varied results (yes, some were losses) because we didn’t have the systems in place to find the bargains.

Hope to see investors from Seattle turn out in big numbers. Make some great connections. Maybe you will decide that this could be your next career.

Because it was a Wacky Wednesday…

Will Hicks lets us know that there are plenty of US embassies still on the market

Ron Ares leads us to the ultimate real estate ethics guru: Ted Truitt

[photopress:wacky_wednesday.jpg,thumb,alignright]Because Flipping should only be practiced by professionals

How not to show a home

It’s the little things that get so darn messy

If you’re willing to follow, Marlow leads us toward a worldly journey of kitchens, bathrooms, bedrooms, etc where there is no normal: Normal Room

And, of course, the original: Wacky Wednesday

Cocktail Party Primer

I’d like to open this thread up to a conversation on the health of the Seattle market…

but there is a catch. I will not allow it to dissolve into a conversation about racism, liberals, RCG, or faith. If you’d like to have a reasonable intellectual conversation, you are more than welcome to participate. If you attack me, RCG, or any contributor, then I’ll happily delete your comment.

By the way, please consider this post the “anti-linkbating” post. Not only will I quickly delete any off topic comments, but more importantly, I will mark those comments as “spam”. That will allow me to ban your email, name, IP, etc. from the site after only a few off-topic comments.

Two days ago, Michael Lindekugel of Team Reba made a very interesting comment. No one ever challenged him on the merits of his argument, so I think it makes an appropriate starting point into a discussion on the health of the Seattle market:

It’s the hot topic at most cocktail parties. Is Seattle going to experience a bubble and burst? The short answer is no…..the long answer follows:

We experienced a busy market with a shortage of supply and increasing demand resulting in four or five offers and short “Days On Market

What makes a house a “tear down”

[photopress:tear_down.jpg,thumb,alignright] Here in Kirkland, a lot of people complain that the builders are tearing down homes and putting up “McMansions” in their place.

I can walk up and down the streets of Kirkland and “label” each and every house I pass. “Remodel project”, “tear down”, “fixer”, “builder’s dream come true”, will sell “as is”, etc… The number one reason a house becomes a tear down is due to years and years of deferred maintenance. Often these homes are owned by people who inherited them or who purchased them many, many years ago when they were dirt cheap. The increase in taxes over the years suck up any money the owners might have had to make improvements. They have just enough money to get by and the moss overtakes the roof, the wood rot overtakes the fascia boards and siding, the trees get bigger and bigger and crack the foundation, birds make nests in the rotted fascia boards. It’s like a used car that finds its way to the scrap heap, once the cost to repair exceeds the book value.

“Book Value” of a house equals the value of the lot. The value of the lot is based on it’s “highest and best use” and based on its “potential”. If the lot would have a view IF it were a two story house, than the highest and best use of that lot is to put a two story house on it. If that gives the lot a value of $650,000, then that is the value of the dirt. People have a tendency to value a property by what is on the lot and say, “Oh I wouldn’t pay more than $350,0000″ for that house!”. If the lot is worth $650,000, then the house can’t sell for $350,000, no matter how awful it is.

Take the house in the photo above. Would you spend $650,000 to LIVE IN IT? If you would pay $125,000 to live in it, and a builder will pay $650,000 to tear it down…well then I guess everyone has to agree that it is a “tear down”. But they don’t all agree that it is a tear down. People never all agree on anything, do they?

They don’t agree because they like having a little tiny house next to them that doesn’t block their view. They don’t agree because they don’t want the noise of the builders putting up a new home next door from morning until night, day after day, so they can never take a nap in the afternoon again until the new home is finished.

They might all agree that it should be torn down, but they want it to become a new park or playground…as long as no one every comes to play in it and make noise 🙂 They never ALL agree that it should be torn down and become a “McMansion”, especially if they live in the cute little bungalow next door.

"Flip This House" is looking for YOU

I received an email today from the casting firm of A&E’s “Flip This House” requesting my assistance in locating persons who have flipped at least ten properties in a year. I know a few people who might be qualified and interested.

I haven’t seen the show. I expect that each week there may be a different host from a different area.


I doubt that it is a “Seattle Area” only request, so if anyone knows of anyone who has done at least 10 flips in 2005, or 10 a year for a few years, shoot me an email.

Thanks. Have no clue what “tag” to put on this one!