Categories
Archives
Home Performance Resources
- Planet Saver University Table of Contents
- Recommended Reading
- California Building Performance Contractors Association
Sign Up to be a Fan!
Archive for the 'Real Estate Tips' Category
September 5th, 2010
Finding Surprising Deals … Across America
Some people have asked, “How do you find the good deals?” and I’ve been thinking about that recently since the last deal found me. For me, there are two types of real estate search, On Purpose, and Serendipity.
I get some of my best ideas about business doing something besides business!
On Purpose includes all the normal methods, searching the REO listings, Courthouse Steps, Direct Mail etc … and we need to keep on doing those methods that work for us. But dont miss out on the Serendipity that can happen by Wandering Around with Curiosity and Expectation.
It’s good to wake up each day desiring to be a blessing and receive a blessing, deliver a miracle and receive a miracle. Then just wander around with curiosity and expectation. Dont get too caught up in the hustle & bustle of the regular On Purpose business … or you may miss the Surprise Blessings.
Here’s how it worked out yesterday on my drive across America. I stopped by to see Andrew & Megan Martinez in York Nebraska. Andrew is looking to do his first Green Flip, so we asked Jennifer Martin, my Realtor, for a referral from her network. Judy Miller did a great job of showing us what was available. We settled on 2 and went to look at them today. That’s the standard approach, business as usual.
Opportunity #1 from Wandering Around With Expectation.
Then we set out, Wandering Around. First we went to a nearby lake and went canoeing. Kicked around some ideas and landed one really good idea that we’ll both use for years to come. Then we went to a restaurant where Andrew knew the owner. Fred mentioned a home that had just gone into foreclosure and wasn’t listed yet. We wandered over & the house looked good, Serendipity #1.
As we were beginning to leave, a gentleman who recognized Andrew from last year’s Christmas party joined our conversation. He learned that we were looking to buy a house and volunteered that he had a house that he was thinking of selling. We went over and looked at it. Serendipity #2. It looked even better than the first one and found that it came with assumable financing! Blessing #3. Now all that needs to be negotiated is the total price and how the balance will be paid.
Opportunity #2 from Wandering Around With Expectation. This one is currently on a land contract which can be assumed. A great benefit that we weren't looking for.
So at my stop at York, Nebraska on my trip across the USA, I looked at 4 properties, 2 were business as usual and 2 were from Wandering Around With Expectation. I’m not saying that one is better than the other. The point is to do both.
The benefit of the normal approaches is that you can always and consistently go to work. The problem with these normal approaches is that everyone else is doing the same thing. So great deals and creative financing are more rare.
The benefit of Wandering Around With Expectation is that you are likely to uncover deals that the competition doesn’t know about and creative financing is more common.
The best book that I’ve read recently on living with this type of Expectation is “You Were Born For This” by Bruce Wilkinson. Bruce says that God is looking to bless people and is looking for delivery boys and girls to deliver miracles and blessings. What a great way to live. Expecting to deliver and receive blessings each and every day. And it makes Energy Wise House Flipping more fun … and profitable.
PS. (later) After the previous post, I was sitting around a campfire and Roger mentioned another house available for $5,000. That got my attention, so we went and looked at it before I left … I’ll keep you posted.
August 17th, 2010
Wholesalers Can Save You A Lot Of Time!
Our next project. See that palm tree and fireplace? They both have to go. They are messing up my Solar Exposure!
We are in escrow to purchase our first property from a “Wholesaler.” I didn’t see it coming, but I’m glad I got a call a couple of weeks ago from Sam Okenyi & his partner, Chris Williams. They were familiar with our Green Renovation and Classy Remodeling work from our job sign and our CraigsList ads and knew that we would be the most likely buyer on their list if they could just get us to take a look at it. (See video of my interview with Sam and Chris) They had found a real mess of a house, un-permitted additions, everything worn out, and a previous attempt at a duplex conversion and had it under contract with a few days left to find the buyer.
Fortunately I had just jumped back into the market after taking a break to evaluate my first 10 transactions and make any adjustments to the mission that might be needed. Here’s what I had found:
1. All 10 jobs were complete and sold or in lease or lease option status.
2. We made money on all of them, from $2,000 to $28,000 each.
3. We always sold for about $20K over the rest of the neighborhood because of the value of our renovations
4. Appraisals came in OK except for the last one, which we are providing details the appraiser missed.
5. 2008 – 2009 was a lot different than the beginning of 2010. A contributor to this was the $8K tax credit which stimulated all the players and made good deals harder to find. The “Crazy Time” provided a good opportunity for me to slow down and finish up all projects and evaluate.
6. Time to get back in the market. I made 5 offers in August, one still has life in it. The “retail” market has returned to acceptable levels where some good deals, (not killer deals) are available. In the interim, I had investigated the courthouse steps, (too much work for my taste), direct mail, (lots of sellers wanting to sell, but once again, not my style) So I was ripe for a wholesale offer.
The great thing about buying from a wholesaler if they have secured a really good deal and provided me with a good clear package is the amount of time it saves me. Sam had emailed me a clear package with his analysis and the comps. So when I met him on the job, I was already educated enough on the area to say, “Let’s do it!”
I made it clear to Sam and Chris what we are looking for, Real Ugly Houses. Guess what? Now that they know that, and know that we are real buyers, they will pull out all stops and really start combing the neighborhoods for us. It’s a Win – Win. I’ve added a marketing department to my team. And I dont have to pay them unless they produce. What a country!
Wholesalers are probably like Teachers (I used to be one) The good ones are way under paid and the bad ones are over paid. What makes a good wholesaler that is worth the spread that they earn, between what they secure the property for, and what they sell it to me for? These 3 things are important
1. They aren’t trying to get rich on one job. (They know the buyer has to make a profit, or they wont come back for seconds)
2. They communicate clearly. They know what I want and make a clear presentation
3. They know how to do same day closings and work with an experienced escrow person.
If all that’s in place, a good wholesaler can save you a lot of time. If you’re interested, you can call Sam at 559 394 9505 or Chris at 559 593 2987. Or check out the 3 part Video Interview of me interviewing them
We talked about Wholesaling in General and how wholesalers and investors can work together as a team.
May 9th, 2010
Home Performance and Pretty? Can I Have Both? Quickly?
Have you ever “day dreamed” or fantasized, “What if life circumstances changed & you re-located across the country and got to choose a new place to live?” I know that if you’re reading this blog, you’re at least somewhat of a Home Performance Geek like me. And I know that only a few of us in this industry actually live in our “Home Performance Dream Home”…. So a little day dreaming and “What If?” thinking is in order for most of us.
Pretty, You Bet! Home Performance? Not So Much.
A couple months ago this Home Performance Day Dream began to come true for me. Son in Law got a job inPurcellville Virginia, so Luelle and I are “following the grandbabies” 3000 miles across the country into a whole new Climate Zone.
At first it was easy, I found a realtor who found a lot that borders on Open Space. That, plus all the “Energy Options” was all I wanted in our new home …. I’ll let my wife pick everything else and the production builder promised to be done in 120 days, maybe less. Sound pretty normal for an Energy Geek Guy?
Then I ran into the reality that maybe “Production Building” and “Home Performance” may not go together too well…
The builder’s website reveals “Last Century” framing details. 2×4 @ 16″ OC, double top plate, bulky corners. It would be so easy to do so much better, from a Home Performance point of view.
The builder has won design awards and offers a lot of pretty house for the money. My wife was sold, and I was going along… until the construction details started being revealed. The standard home was being built to the same standards that I used in 1980. 2×4 walls with no rigid insulation, R-30 ceilings, No sealing of shell or ducts, no treatment of band joists, not even all dual pane windows, Ouch! I could see that I was headed for an identity crisis.
Obviously if I want my perfect Home Performance Dream House, I’ll have to build it myself, And that’s probably what will happen over the next couple of years. But I want to move into something in 120 days. So I’m considering my options and asking for as much Home Performance as I can get from the production builder. They were adamant, no 2×6’s. Rigid Insulation, They are thinking about it. I guess no one’s ever asked for it before.
The way I see it, there are 3 areas of Energy improvement that can be done to a pretty production home:
1. The items the production builder will allow you to upgrade and pay extra for
2. The things that you or someone you hire can do on nights and weekends, additional sealing etc.
3. The things you just have to change after you move in.
So that’s where I am, negotiating for as much of #1 as I can get. And then as much of # 2 as they will allow. And wondering if I have a “breaking point” An amount of last century’s building standards that I just cant live with and still be me.
Have you ever been in this place before? Please Comment. Any tips on negotiating with a production builder who has systems in place that are working for him….? I’ll let you know how this develops.
PS I found this Top 10 List of ways to improve a new house by Martin Holladay. Would you agree? What would you add?
December 20th, 2009
See Two Unique Fresno Attractions Tuesday!
Attendees at the Open House this Tuesday will be treated to two sights that can be seen NO WHERE ELSE. It all happens this Tuesday, Dec. 22 asGreenEarthEquities opens up it’s finished homes and construction projects for a tour. Starting with lunch and mingling at Me n Ed’s Pizza on the corner of Ashlan and Fowler at 11:30 for lunch. Nationally renowned mural artist, Mark DeRaud gives us a whimsical view of Renaissance Art and Life on the walls of the restaurant A former Renaissance employee, we still call on Mark for some of our faux painting requirements.
After some good pizza and Q&A we will visit our second Unique attraction. The most recently completed GreenEarthEquities Energy-Wise Renovation features a totally new type of Air Conditioning and Heating System, a rarely seen Heat Recovery Ventilator system and the adaptation of a New Constructions technique rarely seen in Renovation.
The home is featured on the front cover of Home Energy Magazine. The cover photo shows the Mini Split Heat Pump but the article is mainly about the whole concept of Energy Wise Renovation.
F
inally, (for this stop on the tour) we’ll reveal the reason that all this Energy Efficiency sells so easily in what most people call a depressed market. I’ll also talk about the current sales efforts to sell this home with some new techniques that we are developing right now.
Then we’ll visit the house referred to in previous blogposts as the “Ugliest House In The County” It is about 50% complete and not really ugly anymore…. just in the middle of renovation.
Then we’ll finish with another project that we just started last week. You’ll see it in full demolition mode.
I hope you’ll be able to join us. Please RSVP in the Comments section. And bring all your questions about Energy-Wise Renovation. Who knows? Maybe you’ll be the next to jump into the business of Saving The Planet, One (foreclosed) House At A Time
December 6th, 2009
Influence The Appraisal With Your Open House Brochure?
Today we had an Open House at a newly renovated home. Several people commented about the brochure that we provided, so I decided to post it. 
If you click the images they will expand to full size. It’s our standard 4 page brochure which is more extensive than the standard one page photocopy provided by most realtors.
Each page has a purpose and there is a whole series of slides in PlanetSavers University explaining why we feel it’s worth the extra effort. The first page mentions my Realtor, but just barely. Pictures are obviously important but it also includes neighborhood information, Rent vs Own comparison costs and finally contact info.
Page 2 we call our “Preponderance of Evidence.” This is the “Logic” that allows the buyer to validate in his own mind the emotional decision that got 90% made when his wife walked into the kitchen! (Sorry, that’s the way us humans work)
It really is a long single spaced list. But unless someone points these things out, many of them will be missed, and the decision will default to “Price.” 
It’s our job to “Make The Invisible, Visible” and this page really earns its place when the prospective buyers are conferring later, comparing the homes their Realtor has shown them. This is their crib sheet to remind them that they made a good decision to buy this home! It competes well against the one page Quickie Brochures that they collected at the other homes.
One of the uses of our brochures is to leave a supply of them on the counter after the sale. Appraisers have a hard job on our houses because they sell for quite a bit higher than the rest of the neighborhood. So we use the brochure to give the appraiser the ammunition they need in order to justify the price that my buyer and I have agreed on.
Of course these last two pages help the buyer justify their decision. None of us want to make poor decisions and pay too much. With these pages we are showing them that others are making similar decisions in the same neighborhood.
Check it out. Let me know what you think. Send me a copy of great Open House brochures you’ve used or seen. I’m always looking for ways to improve.
November 21st, 2009
“McMansion” Era Coming To An End?
“McMansion” Era Coming To An End? So wondered a recent Wall Street Journal article. Read it Here.
Slimming Down. Compare the floor plans of a boom-era luxury home and a smaller, post-recession design.
You can recall the history of homebuilding by taking a driving tour in your city. What you’ll notice is that there has always been a small percentage (5-10) of the “Grand Old Homes” Mansions or Near Mansions, and then the rest of the housing stock. In my town of Fresno, CA the Grand Old Homes were on Huntington and Van Ness Boulevard in the early 1900s. Two Stories with 4ooo square feet or more was the order of the day. (Today these are nightmares to renovate from an energy efficiency perspective. Those desiring to do so should view Tom Hanks movie “The Money Pit” and have plenty of patience and cash and check with the Historical Society before proceeding.
During that time, the rest of the town built in the Craftsman and Bungalow style. Two bedroom, one bath from 700 to 1000 feet was the norm with some larger homes having 3 bedrooms and sometimes 2 baths. There were larger homes between the two extremes, but not that many.
(From the WSJ Article) At 2,450 square feet, this new Wieland home in North Carolina looks like a cottage compared with some of the 3,900-square-foot models down the road.
The Housing Boom that came with the Baby Boom after WWII brought a new invention to the market: The American Classic Tract Home, 3 bedroom, 2 bath, 1100 to 1500 square feet moving up to about 2000 square feet as the century closed out.
But along with it came the “Executive Home” aka McMansion. These have the things necessary to impress, not just to live.
Grand Entries with Grand Architectural Staircases
All the Rooms are larger than they need to be, and there are more of them.
As many Baths as Bedrooms is common. Walk-in closets larger than your bedroom growing up.
All the Ceilings are taller than they need to be and they are mainly different from each other
Home Theaters and Gyms and 3 to 5 car garages.
European Chef’s style Kitchen with commercial appliances
And a huge energy bill to go with it….Because these opulent shrines to impressing the neighbors weren’t built any better than their smaller cousins. Actually the smaller home is harder to do poorly and easier to fix than the McMansion. And the McMansion with its architectural wizardry is very easy to get wrong from an energy and comfort perspective.
So here’s the good news:
1. There is going to be a huge opportunity for Home Performance Contractors to fix McMansions.
2. Another huge opportunity is doing a complete EnergyWise Renovation on the All American Tract Home. These homes are actually drawing many of the Baby Boomers who have had the McMansion and are tired of keeping them up
Well Done Complete Energy-Wise Renovations Are In High Demand & Sell Quickly
With Mature Landscaping, all automatic, a new 40 year roof that will outlast them, all new appliances, all new HVAC, Energy Saving Windows and fixtures and paint inside and out and all new tile and floor coverings, what’s to not like about that for easy living? In my experience these renovations are in high demand and sell quickly at full price.
In California there will soon be money available to fund both of these opportunities with the AB 811 funds for Energy Retrofits. There are sites about fixing McMansions. (Check out CBPCA.org for a list of trained Home Performance Contractors) This site will continue to focus on Energy Wise Renovation of moderate sized homes, especially on the Golden Opportunity presented by Foreclosed Homes.
Back to the WSJ article: I didn’t get the impression that the McMansion builders were going away. Or that the buyers demanding the Big House have learned their lesson and changed for good. It seemed they both are pulling back only as much as they have to and a recovered economy would launch them into new realms of opulence. Did I read that into the article? or did you get the same impression? Let me know in the Comments section.
September 6th, 2009
Next “Wave” of Foreclosures: Fact or Fiction? (Dont Hold Your Breath)
We’ve all been told that there’s another “Wave” of foreclosures coming and I’ve even done some of my own planning based on that prediction. Almost all of the people I’ve heard the next “wave theory” from were just repeating what they had heard from someone else. The more thoughtful of these pointed to the continuing rise in Notices Of Default but we all scratched our heads because the expected actual foreclosures didn’t show up on the REO market. What happened? The foreclosures seemed to get lost on their way to the MLS…
I had nothing objective to base it on but just started losing my faith in the Foreclosure Wave theory a few months ago. Then I finally found an objective explanation of why the foreclosures aren’t showing up on the expected schedule. Check out this chart which shows what happened to foreclosures after Secretary Paulson’s Troubled Asset Relief announcement last September 19th. Here it is on the chart, courtesy of Sean O’Toole of Foreclosure Truth.com.
Before and After Secretary Paulson's announcement on Sept 19, 2008
O’Toole explains, “While many will point out this was necessary to keep home loans available and interest rates low, I think it also clearly sent banks a message… you will get more for these assets from the taxpayer than you will through foreclosure. Add to that the mark-to-model rule changes from the Federal Accounting Standards Board, and a ton of politicial pressure and it should be no surprise to anyone that foreclosures have slowed. The drop in foreclosure sales defies logic given the continued increase in properties scheduled to be foreclosed on. But defying logic to do what is politically expedient while simultaneously inflating bank earnings and bonuses and without regard to future consequences IS the new normal. We are yet again trading tomorrow for today.” (Full Article here)
Whether O’Toole’s analysis is right or wrong, the fact remains, Investors can no longer choose from many available foreclosures like in the “old days” of 6 months ago. I believe there are still good deals out there, we just have to look harder for them. The larger spread from buy to sell which is available in foreclosures is what allows me to do large energy saving packages in the renovation and still sell my projects to first time buyers. So even if the good deals are harder to find, they are worth the effort. Here are three techniques that I’m using while waiting for the wave.
1. Increased attention to Short Sales. As you know these can take a long time, so it’s good to have a lot of offers in the pipeline. My broker and I have turned our attention to Short Sales and recently got one (after 5 months)
My Newest Really Ugly House
2. Remember the Ugly House. The house that I just put in escrow last week may qualify for the “Ugliest House” award. Certainly in the City, Maybe the State. My perfect plan is to buy the Worst House in the neighborhood and make it the Best House in the neighborhood. We call it our Cinderella Process. I’ll be showing pictures and talking about my latest Ugly House on the RoundTable Conference Calls every Tuesday at 6pm Pacific. Sign up on the FREE WEBINAR form and I will send you the slide deck before the Conference Call.
3. More Conventional Ways Of Finding Motivated Sellers. We’ve really gotten spoiled this last year with such easy pickings in the REO market. It’s time to dust off some of the harder ways to find those great deals. Pre foreclosure letters, signs, working with attorneys…. none of which are my specialty, but I will post here and we can learn together.
The effort is worth it and we need really good deals if we are going to Save The Planet, One House At A Time thru Energy-Wise House Flipping.
And who knows. The political winds and banking rules may change and the “Wave” may really come. Wise investors will have a little cash available for the buying party when it’s Wave Season.
August 10th, 2009
Found: New Ally For Vets Concerns: Craig of CraigsList
Market Street in San Francisco
It’s great when you meet people of kindred spirit in places you weren’t expecting. I attended the Inman Connect Conference in San Francisco last week expecting to meet a lot of geeks, programers, and architects of Web 2.0. and the Social Media explosion. Which I did.
But perhaps my most valuable contact was Craig Newmark, founder of CraigsList. I was happy to learn of his concern for Veterans. His reach of course, is greater than this humble blog, but his heart and approach is the same as here at GreenEarthEquities — to give our gifts away for free for good causes. I look forward to contacting him in the next few weeks about some new Vets niche market ideas.
The conference was all about where Real Estate and Technology Connect. With over 100 presenters and almost 2000 attendees, it was a GeekFest for sure. Lot’s of new technology which will be showing up here in weeks to come.
Two Teams of programer-developers actually built full-blown applications in two days of the conference. Coffee and Red Bull was unlimited, as the teams worked around the clock, and the crowd was amazed at the final product delivered on the last day.
Ricardo Bueno is my coach for building this Blog!
There were tons of great Tech Sites presented, but here’s just one to bookmark. (More later.) MyTechOpinion is all about technology for Real Estate Investors, and Realtors. It is run by Nichole and Reggie Nicolay, a husband and wife team and has lot’s of great content. One resource to check out is the “Tweet Plan 2.0″ where Nichole likens sending out regular bits of information to your network to Drip Irrigation. Here’s the HomePage: http://www.mytechopinion.com/
Inman Connect is the twice a year conference and Inman News is the daily e-news which is all about Real Estate and Technology. Like most e Journalism these days, the entry level subscription is free. I think the premium service is worth the cost for serious investors.
June 18th, 2009
Who knew? We treat our Vets so badly?
Two weeks ago I had no clue that Veterans have such a difficult time using that supposed benefit, the VA Loan. But in the last two weeks, I’ve got an education. I’ve sold one of my Energy-Wise Renovations to a Veteran. We’ve been working with his wife all along during renovation on design and color selection etc. Now it seems that the family is not going to qualify and I’ve found out that both the credit and appraisal process for Vets is more difficult than either conventional or FHA financing. When I started asking my Realtor friends about this, they all said, “Yes, VA has always been difficult. We shudder when a buyer wants to go VA. We’ll probably spend a lot of time and then the Vet will be disqualified or the house wont appraise and we’ll have to start all over.”
It seems that my GreenEarthEquities projects will never qualify and meet the VA appraisal. With the Wow! Package, the Done! Package and the Energy Package, these homes have all new everything and need to be priced at the top of the Comparables. They are not for everyone. Some people want a fixer upper. I want to provide a nice, finished home, with everything new that wont have maintenance issues for a long time for a returning Vet. My Realtor friends say it isn’t going to happen, not with a VA Loan anyway.
That made me mad to hear that. I’m a Vet. And I enjoyed my Cal-Vet benefit purchasing my first home many years ago. I dont remember any difficulties. I think a lot of Americans agree with me that our Veterans should get preferential treatment…..And it seems that they are actually getting discriminatory treatment. I have three questions which I will be getting the answers for over the next few months
1. Is this poor treatment of our Vets system wide, or is our local situation in Central California an anomaly. (4 out of 5 Realtors I asked rolled their eyes when I asked about VA financing and confirmed the situation described by the first friend that I asked.) How about other areas of the country? Are they more Vet friendly?
2. What can be done to improve the situation for Veterans? Who are the Advocates that work to improve things for our Veterans?
3. Is the Congress and the Obama Administration aware that the VA is treating our Veterans so poorly? And that the VA program has such a bad reputation in the Real Estate Community? Will any politician stand up and be a champion for Vets? It seems that the VA is a bureaucracy that could benefit from some red tape slashing and streamlining……. (that should be politically popular these days)
Please respond if you have any good ideas or contacts. Hopefully together we can turn the VA Loan back into a blessing instead of a curse that it has become.
April 1st, 2009
Investing: The best days to buy
I have found that I get my best bargains in one of two times: Either the first day that a listing hits the market, or after many months. First response has worked well for me, as has being the first one in after a price reduction. So the maxim is true, “The early bird gets the worm.”
On the other end of the spectrum the listing that has sat around for a long time can be a good deal as well. Maybe it was over priced at the beginning. I buy mostly foreclosures to do my Energy Wise Renovations and it seems that some banks are having difficulty coming to terms with what has happened to the value of all that collateral that they have foreclosed on. Sometimes 6 or 8 or 10 months is needed for them to get reasonable. Not only has the market gone down further in that time, the property may have sustained vandalism, graffitti and at least more deferred maintenance. Add to this the pressures that go on inside a bank REO department and you can see why sometimes these old listings sell at half of their original listing price.
The other reason that a listing will stay around a long time is that it may be a really ugly house. Really beat up. Boarded up, broken windows, graffitti, illegal additions, meth lab, mold, etc. And a lot more work than a normal “carpet and paint” investor is willing or capable of doing. These are where I have found my most profitable deals of all. It’s all about value added. If a whole lot of value must be added, and you and your team are willing and able to do it and the others aren’t, you can leave the competitors behind and charge a lot for all that value that you added, assuming that you can buy it right. Today I visited the ugliest house I ever bought. It’s in its final weeks of renovation and will turn the biggest profit I’ve ever made. I’ll post about it soon with some before and after pictures.
So I like the first day and toward the last day of a listing. But there is another time that I am learning how to find. That is before the first day of MLS listing. It depends on relationships and I am beginning to build them. I will post here for fellow investors when I have developed some successful systems at this.
I get some of my best ideas about business doing something besides business!
Opportunity #1 from Wandering Around With Expectation.
Opportunity #2 from Wandering Around With Expectation. This one is currently on a land contract which can be assumed. A great benefit that we weren't looking for.
Wholesalers Can Save You A Lot Of Time!
Our next project. See that palm tree and fireplace? They both have to go. They are messing up my Solar Exposure!
We are in escrow to purchase our first property from a “Wholesaler.” I didn’t see it coming, but I’m glad I got a call a couple of weeks ago from Sam Okenyi & his partner, Chris Williams. They were familiar with our Green Renovation and Classy Remodeling work from our job sign and our CraigsList ads and knew that we would be the most likely buyer on their list if they could just get us to take a look at it. (See video of my interview with Sam and Chris) They had found a real mess of a house, un-permitted additions, everything worn out, and a previous attempt at a duplex conversion and had it under contract with a few days left to find the buyer.
Fortunately I had just jumped back into the market after taking a break to evaluate my first 10 transactions and make any adjustments to the mission that might be needed. Here’s what I had found:
1. All 10 jobs were complete and sold or in lease or lease option status.
2. We made money on all of them, from $2,000 to $28,000 each.
3. We always sold for about $20K over the rest of the neighborhood because of the value of our renovations
4. Appraisals came in OK except for the last one, which we are providing details the appraiser missed.
5. 2008 – 2009 was a lot different than the beginning of 2010. A contributor to this was the $8K tax credit which stimulated all the players and made good deals harder to find. The “Crazy Time” provided a good opportunity for me to slow down and finish up all projects and evaluate.
6. Time to get back in the market. I made 5 offers in August, one still has life in it. The “retail” market has returned to acceptable levels where some good deals, (not killer deals) are available. In the interim, I had investigated the courthouse steps, (too much work for my taste), direct mail, (lots of sellers wanting to sell, but once again, not my style) So I was ripe for a wholesale offer.
The great thing about buying from a wholesaler if they have secured a really good deal and provided me with a good clear package is the amount of time it saves me. Sam had emailed me a clear package with his analysis and the comps. So when I met him on the job, I was already educated enough on the area to say, “Let’s do it!”
I made it clear to Sam and Chris what we are looking for, Real Ugly Houses. Guess what? Now that they know that, and know that we are real buyers, they will pull out all stops and really start combing the neighborhoods for us. It’s a Win – Win. I’ve added a marketing department to my team. And I dont have to pay them unless they produce. What a country!
Wholesalers are probably like Teachers (I used to be one) The good ones are way under paid and the bad ones are over paid. What makes a good wholesaler that is worth the spread that they earn, between what they secure the property for, and what they sell it to me for? These 3 things are important
1. They aren’t trying to get rich on one job. (They know the buyer has to make a profit, or they wont come back for seconds)
2. They communicate clearly. They know what I want and make a clear presentation
3. They know how to do same day closings and work with an experienced escrow person.
If all that’s in place, a good wholesaler can save you a lot of time. If you’re interested, you can call Sam at 559 394 9505 or Chris at 559 593 2987. Or check out the 3 part Video Interview of me interviewing them
We talked about Wholesaling in General and how wholesalers and investors can work together as a team.
May 9th, 2010
Home Performance and Pretty? Can I Have Both? Quickly?
Have you ever “day dreamed” or fantasized, “What if life circumstances changed & you re-located across the country and got to choose a new place to live?” I know that if you’re reading this blog, you’re at least somewhat of a Home Performance Geek like me. And I know that only a few of us in this industry actually live in our “Home Performance Dream Home”…. So a little day dreaming and “What If?” thinking is in order for most of us.
Pretty, You Bet! Home Performance? Not So Much.
A couple months ago this Home Performance Day Dream began to come true for me. Son in Law got a job inPurcellville Virginia, so Luelle and I are “following the grandbabies” 3000 miles across the country into a whole new Climate Zone.
At first it was easy, I found a realtor who found a lot that borders on Open Space. That, plus all the “Energy Options” was all I wanted in our new home …. I’ll let my wife pick everything else and the production builder promised to be done in 120 days, maybe less. Sound pretty normal for an Energy Geek Guy?
Then I ran into the reality that maybe “Production Building” and “Home Performance” may not go together too well…
The builder’s website reveals “Last Century” framing details. 2×4 @ 16″ OC, double top plate, bulky corners. It would be so easy to do so much better, from a Home Performance point of view.
The builder has won design awards and offers a lot of pretty house for the money. My wife was sold, and I was going along… until the construction details started being revealed. The standard home was being built to the same standards that I used in 1980. 2×4 walls with no rigid insulation, R-30 ceilings, No sealing of shell or ducts, no treatment of band joists, not even all dual pane windows, Ouch! I could see that I was headed for an identity crisis.
Obviously if I want my perfect Home Performance Dream House, I’ll have to build it myself, And that’s probably what will happen over the next couple of years. But I want to move into something in 120 days. So I’m considering my options and asking for as much Home Performance as I can get from the production builder. They were adamant, no 2×6’s. Rigid Insulation, They are thinking about it. I guess no one’s ever asked for it before.
The way I see it, there are 3 areas of Energy improvement that can be done to a pretty production home:
1. The items the production builder will allow you to upgrade and pay extra for
2. The things that you or someone you hire can do on nights and weekends, additional sealing etc.
3. The things you just have to change after you move in.
So that’s where I am, negotiating for as much of #1 as I can get. And then as much of # 2 as they will allow. And wondering if I have a “breaking point” An amount of last century’s building standards that I just cant live with and still be me.
Have you ever been in this place before? Please Comment. Any tips on negotiating with a production builder who has systems in place that are working for him….? I’ll let you know how this develops.
PS I found this Top 10 List of ways to improve a new house by Martin Holladay. Would you agree? What would you add?
December 20th, 2009
See Two Unique Fresno Attractions Tuesday!
Attendees at the Open House this Tuesday will be treated to two sights that can be seen NO WHERE ELSE. It all happens this Tuesday, Dec. 22 asGreenEarthEquities opens up it’s finished homes and construction projects for a tour. Starting with lunch and mingling at Me n Ed’s Pizza on the corner of Ashlan and Fowler at 11:30 for lunch. Nationally renowned mural artist, Mark DeRaud gives us a whimsical view of Renaissance Art and Life on the walls of the restaurant A former Renaissance employee, we still call on Mark for some of our faux painting requirements.
After some good pizza and Q&A we will visit our second Unique attraction. The most recently completed GreenEarthEquities Energy-Wise Renovation features a totally new type of Air Conditioning and Heating System, a rarely seen Heat Recovery Ventilator system and the adaptation of a New Constructions technique rarely seen in Renovation.
The home is featured on the front cover of Home Energy Magazine. The cover photo shows the Mini Split Heat Pump but the article is mainly about the whole concept of Energy Wise Renovation.
Finally, (for this stop on the tour) we’ll reveal the reason that all this Energy Efficiency sells so easily in what most people call a depressed market. I’ll also talk about the current sales efforts to sell this home with some new techniques that we are developing right now.
Then we’ll visit the house referred to in previous blogposts as the “Ugliest House In The County” It is about 50% complete and not really ugly anymore…. just in the middle of renovation.
Then we’ll finish with another project that we just started last week. You’ll see it in full demolition mode.
I hope you’ll be able to join us. Please RSVP in the Comments section. And bring all your questions about Energy-Wise Renovation. Who knows? Maybe you’ll be the next to jump into the business of Saving The Planet, One (foreclosed) House At A Time
December 6th, 2009
Influence The Appraisal With Your Open House Brochure?
Today we had an Open House at a newly renovated home. Several people commented about the brochure that we provided, so I decided to post it. If you click the images they will expand to full size. It’s our standard 4 page brochure which is more extensive than the standard one page photocopy provided by most realtors.
Each page has a purpose and there is a whole series of slides in PlanetSavers University explaining why we feel it’s worth the extra effort. The first page mentions my Realtor, but just barely. Pictures are obviously important but it also includes neighborhood information, Rent vs Own comparison costs and finally contact info.
Page 2 we call our “Preponderance of Evidence.” This is the “Logic” that allows the buyer to validate in his own mind the emotional decision that got 90% made when his wife walked into the kitchen! (Sorry, that’s the way us humans work)
It really is a long single spaced list. But unless someone points these things out, many of them will be missed, and the decision will default to “Price.” It’s our job to “Make The Invisible, Visible” and this page really earns its place when the prospective buyers are conferring later, comparing the homes their Realtor has shown them. This is their crib sheet to remind them that they made a good decision to buy this home! It competes well against the one page Quickie Brochures that they collected at the other homes.
One of the uses of our brochures is to leave a supply of them on the counter after the sale. Appraisers have a hard job on our houses because they sell for quite a bit higher than the rest of the neighborhood. So we use the brochure to give the appraiser the ammunition they need in order to justify the price that my buyer and I have agreed on.
Of course these last two pages help the buyer justify their decision. None of us want to make poor decisions and pay too much. With these pages we are showing them that others are making similar decisions in the same neighborhood.
Check it out. Let me know what you think. Send me a copy of great Open House brochures you’ve used or seen. I’m always looking for ways to improve.
November 21st, 2009
“McMansion” Era Coming To An End?
“McMansion” Era Coming To An End? So wondered a recent Wall Street Journal article. Read it Here.
Slimming Down. Compare the floor plans of a boom-era luxury home and a smaller, post-recession design.
You can recall the history of homebuilding by taking a driving tour in your city. What you’ll notice is that there has always been a small percentage (5-10) of the “Grand Old Homes” Mansions or Near Mansions, and then the rest of the housing stock. In my town of Fresno, CA the Grand Old Homes were on Huntington and Van Ness Boulevard in the early 1900s. Two Stories with 4ooo square feet or more was the order of the day. (Today these are nightmares to renovate from an energy efficiency perspective. Those desiring to do so should view Tom Hanks movie “The Money Pit” and have plenty of patience and cash and check with the Historical Society before proceeding.
During that time, the rest of the town built in the Craftsman and Bungalow style. Two bedroom, one bath from 700 to 1000 feet was the norm with some larger homes having 3 bedrooms and sometimes 2 baths. There were larger homes between the two extremes, but not that many.
(From the WSJ Article) At 2,450 square feet, this new Wieland home in North Carolina looks like a cottage compared with some of the 3,900-square-foot models down the road.
The Housing Boom that came with the Baby Boom after WWII brought a new invention to the market: The American Classic Tract Home, 3 bedroom, 2 bath, 1100 to 1500 square feet moving up to about 2000 square feet as the century closed out.
But along with it came the “Executive Home” aka McMansion. These have the things necessary to impress, not just to live.
Grand Entries with Grand Architectural Staircases
All the Rooms are larger than they need to be, and there are more of them.
As many Baths as Bedrooms is common. Walk-in closets larger than your bedroom growing up.
All the Ceilings are taller than they need to be and they are mainly different from each other
Home Theaters and Gyms and 3 to 5 car garages.
European Chef’s style Kitchen with commercial appliances
And a huge energy bill to go with it….Because these opulent shrines to impressing the neighbors weren’t built any better than their smaller cousins. Actually the smaller home is harder to do poorly and easier to fix than the McMansion. And the McMansion with its architectural wizardry is very easy to get wrong from an energy and comfort perspective.
So here’s the good news:
1. There is going to be a huge opportunity for Home Performance Contractors to fix McMansions.
2. Another huge opportunity is doing a complete EnergyWise Renovation on the All American Tract Home. These homes are actually drawing many of the Baby Boomers who have had the McMansion and are tired of keeping them up
Well Done Complete Energy-Wise Renovations Are In High Demand & Sell Quickly
With Mature Landscaping, all automatic, a new 40 year roof that will outlast them, all new appliances, all new HVAC, Energy Saving Windows and fixtures and paint inside and out and all new tile and floor coverings, what’s to not like about that for easy living? In my experience these renovations are in high demand and sell quickly at full price.
In California there will soon be money available to fund both of these opportunities with the AB 811 funds for Energy Retrofits. There are sites about fixing McMansions. (Check out CBPCA.org for a list of trained Home Performance Contractors) This site will continue to focus on Energy Wise Renovation of moderate sized homes, especially on the Golden Opportunity presented by Foreclosed Homes.
Back to the WSJ article: I didn’t get the impression that the McMansion builders were going away. Or that the buyers demanding the Big House have learned their lesson and changed for good. It seemed they both are pulling back only as much as they have to and a recovered economy would launch them into new realms of opulence. Did I read that into the article? or did you get the same impression? Let me know in the Comments section.
September 6th, 2009
Next “Wave” of Foreclosures: Fact or Fiction? (Dont Hold Your Breath)
We’ve all been told that there’s another “Wave” of foreclosures coming and I’ve even done some of my own planning based on that prediction. Almost all of the people I’ve heard the next “wave theory” from were just repeating what they had heard from someone else. The more thoughtful of these pointed to the continuing rise in Notices Of Default but we all scratched our heads because the expected actual foreclosures didn’t show up on the REO market. What happened? The foreclosures seemed to get lost on their way to the MLS…
I had nothing objective to base it on but just started losing my faith in the Foreclosure Wave theory a few months ago. Then I finally found an objective explanation of why the foreclosures aren’t showing up on the expected schedule. Check out this chart which shows what happened to foreclosures after Secretary Paulson’s Troubled Asset Relief announcement last September 19th. Here it is on the chart, courtesy of Sean O’Toole of Foreclosure Truth.com.
Before and After Secretary Paulson's announcement on Sept 19, 2008
O’Toole explains, “While many will point out this was necessary to keep home loans available and interest rates low, I think it also clearly sent banks a message… you will get more for these assets from the taxpayer than you will through foreclosure. Add to that the mark-to-model rule changes from the Federal Accounting Standards Board, and a ton of politicial pressure and it should be no surprise to anyone that foreclosures have slowed. The drop in foreclosure sales defies logic given the continued increase in properties scheduled to be foreclosed on. But defying logic to do what is politically expedient while simultaneously inflating bank earnings and bonuses and without regard to future consequences IS the new normal. We are yet again trading tomorrow for today.” (Full Article here)
Whether O’Toole’s analysis is right or wrong, the fact remains, Investors can no longer choose from many available foreclosures like in the “old days” of 6 months ago. I believe there are still good deals out there, we just have to look harder for them. The larger spread from buy to sell which is available in foreclosures is what allows me to do large energy saving packages in the renovation and still sell my projects to first time buyers. So even if the good deals are harder to find, they are worth the effort. Here are three techniques that I’m using while waiting for the wave.
1. Increased attention to Short Sales. As you know these can take a long time, so it’s good to have a lot of offers in the pipeline. My broker and I have turned our attention to Short Sales and recently got one (after 5 months)
My Newest Really Ugly House
2. Remember the Ugly House. The house that I just put in escrow last week may qualify for the “Ugliest House” award. Certainly in the City, Maybe the State. My perfect plan is to buy the Worst House in the neighborhood and make it the Best House in the neighborhood. We call it our Cinderella Process. I’ll be showing pictures and talking about my latest Ugly House on the RoundTable Conference Calls every Tuesday at 6pm Pacific. Sign up on the FREE WEBINAR form and I will send you the slide deck before the Conference Call.
3. More Conventional Ways Of Finding Motivated Sellers. We’ve really gotten spoiled this last year with such easy pickings in the REO market. It’s time to dust off some of the harder ways to find those great deals. Pre foreclosure letters, signs, working with attorneys…. none of which are my specialty, but I will post here and we can learn together.
The effort is worth it and we need really good deals if we are going to Save The Planet, One House At A Time thru Energy-Wise House Flipping.
And who knows. The political winds and banking rules may change and the “Wave” may really come. Wise investors will have a little cash available for the buying party when it’s Wave Season.
August 10th, 2009
Found: New Ally For Vets Concerns: Craig of CraigsList
Market Street in San Francisco
It’s great when you meet people of kindred spirit in places you weren’t expecting. I attended the Inman Connect Conference in San Francisco last week expecting to meet a lot of geeks, programers, and architects of Web 2.0. and the Social Media explosion. Which I did.
But perhaps my most valuable contact was Craig Newmark, founder of CraigsList. I was happy to learn of his concern for Veterans. His reach of course, is greater than this humble blog, but his heart and approach is the same as here at GreenEarthEquities — to give our gifts away for free for good causes. I look forward to contacting him in the next few weeks about some new Vets niche market ideas.
The conference was all about where Real Estate and Technology Connect. With over 100 presenters and almost 2000 attendees, it was a GeekFest for sure. Lot’s of new technology which will be showing up here in weeks to come.
Two Teams of programer-developers actually built full-blown applications in two days of the conference. Coffee and Red Bull was unlimited, as the teams worked around the clock, and the crowd was amazed at the final product delivered on the last day.
Ricardo Bueno is my coach for building this Blog!
There were tons of great Tech Sites presented, but here’s just one to bookmark. (More later.) MyTechOpinion is all about technology for Real Estate Investors, and Realtors. It is run by Nichole and Reggie Nicolay, a husband and wife team and has lot’s of great content. One resource to check out is the “Tweet Plan 2.0″ where Nichole likens sending out regular bits of information to your network to Drip Irrigation. Here’s the HomePage: http://www.mytechopinion.com/
Inman Connect is the twice a year conference and Inman News is the daily e-news which is all about Real Estate and Technology. Like most e Journalism these days, the entry level subscription is free. I think the premium service is worth the cost for serious investors.
June 18th, 2009
Who knew? We treat our Vets so badly?
Two weeks ago I had no clue that Veterans have such a difficult time using that supposed benefit, the VA Loan. But in the last two weeks, I’ve got an education. I’ve sold one of my Energy-Wise Renovations to a Veteran. We’ve been working with his wife all along during renovation on design and color selection etc. Now it seems that the family is not going to qualify and I’ve found out that both the credit and appraisal process for Vets is more difficult than either conventional or FHA financing. When I started asking my Realtor friends about this, they all said, “Yes, VA has always been difficult. We shudder when a buyer wants to go VA. We’ll probably spend a lot of time and then the Vet will be disqualified or the house wont appraise and we’ll have to start all over.”
It seems that my GreenEarthEquities projects will never qualify and meet the VA appraisal. With the Wow! Package, the Done! Package and the Energy Package, these homes have all new everything and need to be priced at the top of the Comparables. They are not for everyone. Some people want a fixer upper. I want to provide a nice, finished home, with everything new that wont have maintenance issues for a long time for a returning Vet. My Realtor friends say it isn’t going to happen, not with a VA Loan anyway.
That made me mad to hear that. I’m a Vet. And I enjoyed my Cal-Vet benefit purchasing my first home many years ago. I dont remember any difficulties. I think a lot of Americans agree with me that our Veterans should get preferential treatment…..And it seems that they are actually getting discriminatory treatment. I have three questions which I will be getting the answers for over the next few months
1. Is this poor treatment of our Vets system wide, or is our local situation in Central California an anomaly. (4 out of 5 Realtors I asked rolled their eyes when I asked about VA financing and confirmed the situation described by the first friend that I asked.) How about other areas of the country? Are they more Vet friendly?
2. What can be done to improve the situation for Veterans? Who are the Advocates that work to improve things for our Veterans?
3. Is the Congress and the Obama Administration aware that the VA is treating our Veterans so poorly? And that the VA program has such a bad reputation in the Real Estate Community? Will any politician stand up and be a champion for Vets? It seems that the VA is a bureaucracy that could benefit from some red tape slashing and streamlining……. (that should be politically popular these days)
Please respond if you have any good ideas or contacts. Hopefully together we can turn the VA Loan back into a blessing instead of a curse that it has become.
April 1st, 2009
Investing: The best days to buy
I have found that I get my best bargains in one of two times: Either the first day that a listing hits the market, or after many months. First response has worked well for me, as has being the first one in after a price reduction. So the maxim is true, “The early bird gets the worm.”
On the other end of the spectrum the listing that has sat around for a long time can be a good deal as well. Maybe it was over priced at the beginning. I buy mostly foreclosures to do my Energy Wise Renovations and it seems that some banks are having difficulty coming to terms with what has happened to the value of all that collateral that they have foreclosed on. Sometimes 6 or 8 or 10 months is needed for them to get reasonable. Not only has the market gone down further in that time, the property may have sustained vandalism, graffitti and at least more deferred maintenance. Add to this the pressures that go on inside a bank REO department and you can see why sometimes these old listings sell at half of their original listing price.
The other reason that a listing will stay around a long time is that it may be a really ugly house. Really beat up. Boarded up, broken windows, graffitti, illegal additions, meth lab, mold, etc. And a lot more work than a normal “carpet and paint” investor is willing or capable of doing. These are where I have found my most profitable deals of all. It’s all about value added. If a whole lot of value must be added, and you and your team are willing and able to do it and the others aren’t, you can leave the competitors behind and charge a lot for all that value that you added, assuming that you can buy it right. Today I visited the ugliest house I ever bought. It’s in its final weeks of renovation and will turn the biggest profit I’ve ever made. I’ll post about it soon with some before and after pictures.
So I like the first day and toward the last day of a listing. But there is another time that I am learning how to find. That is before the first day of MLS listing. It depends on relationships and I am beginning to build them. I will post here for fellow investors when I have developed some successful systems at this.
Pretty, You Bet! Home Performance? Not So Much.
The builder’s website reveals “Last Century” framing details. 2×4 @ 16″ OC, double top plate, bulky corners. It would be so easy to do so much better, from a Home Performance point of view.
See Two Unique Fresno Attractions Tuesday!
Attendees at the Open House this Tuesday will be treated to two sights that can be seen NO WHERE ELSE. It all happens this Tuesday, Dec. 22 asGreenEarthEquities opens up it’s finished homes and construction projects for a tour. Starting with lunch and mingling at Me n Ed’s Pizza on the corner of Ashlan and Fowler at 11:30 for lunch. Nationally renowned mural artist, Mark DeRaud gives us a whimsical view of Renaissance Art and Life on the walls of the restaurant A former Renaissance employee, we still call on Mark for some of our faux painting requirements.
After some good pizza and Q&A we will visit our second Unique attraction. The most recently completed GreenEarthEquities Energy-Wise Renovation features a totally new type of Air Conditioning and Heating System, a rarely seen Heat Recovery Ventilator system and the adaptation of a New Constructions technique rarely seen in Renovation.
The home is featured on the front cover of Home Energy Magazine. The cover photo shows the Mini Split Heat Pump but the article is mainly about the whole concept of Energy Wise Renovation.
Finally, (for this stop on the tour) we’ll reveal the reason that all this Energy Efficiency sells so easily in what most people call a depressed market. I’ll also talk about the current sales efforts to sell this home with some new techniques that we are developing right now.
Then we’ll visit the house referred to in previous blogposts as the “Ugliest House In The County” It is about 50% complete and not really ugly anymore…. just in the middle of renovation.
Then we’ll finish with another project that we just started last week. You’ll see it in full demolition mode.
I hope you’ll be able to join us. Please RSVP in the Comments section. And bring all your questions about Energy-Wise Renovation. Who knows? Maybe you’ll be the next to jump into the business of Saving The Planet, One (foreclosed) House At A Time
December 6th, 2009
Influence The Appraisal With Your Open House Brochure?
Today we had an Open House at a newly renovated home. Several people commented about the brochure that we provided, so I decided to post it. If you click the images they will expand to full size. It’s our standard 4 page brochure which is more extensive than the standard one page photocopy provided by most realtors.
Each page has a purpose and there is a whole series of slides in PlanetSavers University explaining why we feel it’s worth the extra effort. The first page mentions my Realtor, but just barely. Pictures are obviously important but it also includes neighborhood information, Rent vs Own comparison costs and finally contact info.
Page 2 we call our “Preponderance of Evidence.” This is the “Logic” that allows the buyer to validate in his own mind the emotional decision that got 90% made when his wife walked into the kitchen! (Sorry, that’s the way us humans work)
It really is a long single spaced list. But unless someone points these things out, many of them will be missed, and the decision will default to “Price.” It’s our job to “Make The Invisible, Visible” and this page really earns its place when the prospective buyers are conferring later, comparing the homes their Realtor has shown them. This is their crib sheet to remind them that they made a good decision to buy this home! It competes well against the one page Quickie Brochures that they collected at the other homes.
One of the uses of our brochures is to leave a supply of them on the counter after the sale. Appraisers have a hard job on our houses because they sell for quite a bit higher than the rest of the neighborhood. So we use the brochure to give the appraiser the ammunition they need in order to justify the price that my buyer and I have agreed on.
Of course these last two pages help the buyer justify their decision. None of us want to make poor decisions and pay too much. With these pages we are showing them that others are making similar decisions in the same neighborhood.
Check it out. Let me know what you think. Send me a copy of great Open House brochures you’ve used or seen. I’m always looking for ways to improve.
November 21st, 2009
“McMansion” Era Coming To An End?
“McMansion” Era Coming To An End? So wondered a recent Wall Street Journal article. Read it Here.
Slimming Down. Compare the floor plans of a boom-era luxury home and a smaller, post-recession design.
You can recall the history of homebuilding by taking a driving tour in your city. What you’ll notice is that there has always been a small percentage (5-10) of the “Grand Old Homes” Mansions or Near Mansions, and then the rest of the housing stock. In my town of Fresno, CA the Grand Old Homes were on Huntington and Van Ness Boulevard in the early 1900s. Two Stories with 4ooo square feet or more was the order of the day. (Today these are nightmares to renovate from an energy efficiency perspective. Those desiring to do so should view Tom Hanks movie “The Money Pit” and have plenty of patience and cash and check with the Historical Society before proceeding.
During that time, the rest of the town built in the Craftsman and Bungalow style. Two bedroom, one bath from 700 to 1000 feet was the norm with some larger homes having 3 bedrooms and sometimes 2 baths. There were larger homes between the two extremes, but not that many.
(From the WSJ Article) At 2,450 square feet, this new Wieland home in North Carolina looks like a cottage compared with some of the 3,900-square-foot models down the road.
The Housing Boom that came with the Baby Boom after WWII brought a new invention to the market: The American Classic Tract Home, 3 bedroom, 2 bath, 1100 to 1500 square feet moving up to about 2000 square feet as the century closed out.
But along with it came the “Executive Home” aka McMansion. These have the things necessary to impress, not just to live.
Grand Entries with Grand Architectural Staircases
All the Rooms are larger than they need to be, and there are more of them.
As many Baths as Bedrooms is common. Walk-in closets larger than your bedroom growing up.
All the Ceilings are taller than they need to be and they are mainly different from each other
Home Theaters and Gyms and 3 to 5 car garages.
European Chef’s style Kitchen with commercial appliances
And a huge energy bill to go with it….Because these opulent shrines to impressing the neighbors weren’t built any better than their smaller cousins. Actually the smaller home is harder to do poorly and easier to fix than the McMansion. And the McMansion with its architectural wizardry is very easy to get wrong from an energy and comfort perspective.
So here’s the good news:
1. There is going to be a huge opportunity for Home Performance Contractors to fix McMansions.
2. Another huge opportunity is doing a complete EnergyWise Renovation on the All American Tract Home. These homes are actually drawing many of the Baby Boomers who have had the McMansion and are tired of keeping them up
Well Done Complete Energy-Wise Renovations Are In High Demand & Sell Quickly
With Mature Landscaping, all automatic, a new 40 year roof that will outlast them, all new appliances, all new HVAC, Energy Saving Windows and fixtures and paint inside and out and all new tile and floor coverings, what’s to not like about that for easy living? In my experience these renovations are in high demand and sell quickly at full price.
In California there will soon be money available to fund both of these opportunities with the AB 811 funds for Energy Retrofits. There are sites about fixing McMansions. (Check out CBPCA.org for a list of trained Home Performance Contractors) This site will continue to focus on Energy Wise Renovation of moderate sized homes, especially on the Golden Opportunity presented by Foreclosed Homes.
Back to the WSJ article: I didn’t get the impression that the McMansion builders were going away. Or that the buyers demanding the Big House have learned their lesson and changed for good. It seemed they both are pulling back only as much as they have to and a recovered economy would launch them into new realms of opulence. Did I read that into the article? or did you get the same impression? Let me know in the Comments section.
September 6th, 2009
Next “Wave” of Foreclosures: Fact or Fiction? (Dont Hold Your Breath)
We’ve all been told that there’s another “Wave” of foreclosures coming and I’ve even done some of my own planning based on that prediction. Almost all of the people I’ve heard the next “wave theory” from were just repeating what they had heard from someone else. The more thoughtful of these pointed to the continuing rise in Notices Of Default but we all scratched our heads because the expected actual foreclosures didn’t show up on the REO market. What happened? The foreclosures seemed to get lost on their way to the MLS…
I had nothing objective to base it on but just started losing my faith in the Foreclosure Wave theory a few months ago. Then I finally found an objective explanation of why the foreclosures aren’t showing up on the expected schedule. Check out this chart which shows what happened to foreclosures after Secretary Paulson’s Troubled Asset Relief announcement last September 19th. Here it is on the chart, courtesy of Sean O’Toole of Foreclosure Truth.com.
Before and After Secretary Paulson's announcement on Sept 19, 2008
O’Toole explains, “While many will point out this was necessary to keep home loans available and interest rates low, I think it also clearly sent banks a message… you will get more for these assets from the taxpayer than you will through foreclosure. Add to that the mark-to-model rule changes from the Federal Accounting Standards Board, and a ton of politicial pressure and it should be no surprise to anyone that foreclosures have slowed. The drop in foreclosure sales defies logic given the continued increase in properties scheduled to be foreclosed on. But defying logic to do what is politically expedient while simultaneously inflating bank earnings and bonuses and without regard to future consequences IS the new normal. We are yet again trading tomorrow for today.” (Full Article here)
Whether O’Toole’s analysis is right or wrong, the fact remains, Investors can no longer choose from many available foreclosures like in the “old days” of 6 months ago. I believe there are still good deals out there, we just have to look harder for them. The larger spread from buy to sell which is available in foreclosures is what allows me to do large energy saving packages in the renovation and still sell my projects to first time buyers. So even if the good deals are harder to find, they are worth the effort. Here are three techniques that I’m using while waiting for the wave.
1. Increased attention to Short Sales. As you know these can take a long time, so it’s good to have a lot of offers in the pipeline. My broker and I have turned our attention to Short Sales and recently got one (after 5 months)
My Newest Really Ugly House
2. Remember the Ugly House. The house that I just put in escrow last week may qualify for the “Ugliest House” award. Certainly in the City, Maybe the State. My perfect plan is to buy the Worst House in the neighborhood and make it the Best House in the neighborhood. We call it our Cinderella Process. I’ll be showing pictures and talking about my latest Ugly House on the RoundTable Conference Calls every Tuesday at 6pm Pacific. Sign up on the FREE WEBINAR form and I will send you the slide deck before the Conference Call.
3. More Conventional Ways Of Finding Motivated Sellers. We’ve really gotten spoiled this last year with such easy pickings in the REO market. It’s time to dust off some of the harder ways to find those great deals. Pre foreclosure letters, signs, working with attorneys…. none of which are my specialty, but I will post here and we can learn together.
The effort is worth it and we need really good deals if we are going to Save The Planet, One House At A Time thru Energy-Wise House Flipping.
And who knows. The political winds and banking rules may change and the “Wave” may really come. Wise investors will have a little cash available for the buying party when it’s Wave Season.
August 10th, 2009
Found: New Ally For Vets Concerns: Craig of CraigsList
Market Street in San Francisco
It’s great when you meet people of kindred spirit in places you weren’t expecting. I attended the Inman Connect Conference in San Francisco last week expecting to meet a lot of geeks, programers, and architects of Web 2.0. and the Social Media explosion. Which I did.
But perhaps my most valuable contact was Craig Newmark, founder of CraigsList. I was happy to learn of his concern for Veterans. His reach of course, is greater than this humble blog, but his heart and approach is the same as here at GreenEarthEquities — to give our gifts away for free for good causes. I look forward to contacting him in the next few weeks about some new Vets niche market ideas.
The conference was all about where Real Estate and Technology Connect. With over 100 presenters and almost 2000 attendees, it was a GeekFest for sure. Lot’s of new technology which will be showing up here in weeks to come.
Two Teams of programer-developers actually built full-blown applications in two days of the conference. Coffee and Red Bull was unlimited, as the teams worked around the clock, and the crowd was amazed at the final product delivered on the last day.
Ricardo Bueno is my coach for building this Blog!
There were tons of great Tech Sites presented, but here’s just one to bookmark. (More later.) MyTechOpinion is all about technology for Real Estate Investors, and Realtors. It is run by Nichole and Reggie Nicolay, a husband and wife team and has lot’s of great content. One resource to check out is the “Tweet Plan 2.0″ where Nichole likens sending out regular bits of information to your network to Drip Irrigation. Here’s the HomePage: http://www.mytechopinion.com/
Inman Connect is the twice a year conference and Inman News is the daily e-news which is all about Real Estate and Technology. Like most e Journalism these days, the entry level subscription is free. I think the premium service is worth the cost for serious investors.
June 18th, 2009
Who knew? We treat our Vets so badly?
Two weeks ago I had no clue that Veterans have such a difficult time using that supposed benefit, the VA Loan. But in the last two weeks, I’ve got an education. I’ve sold one of my Energy-Wise Renovations to a Veteran. We’ve been working with his wife all along during renovation on design and color selection etc. Now it seems that the family is not going to qualify and I’ve found out that both the credit and appraisal process for Vets is more difficult than either conventional or FHA financing. When I started asking my Realtor friends about this, they all said, “Yes, VA has always been difficult. We shudder when a buyer wants to go VA. We’ll probably spend a lot of time and then the Vet will be disqualified or the house wont appraise and we’ll have to start all over.”
It seems that my GreenEarthEquities projects will never qualify and meet the VA appraisal. With the Wow! Package, the Done! Package and the Energy Package, these homes have all new everything and need to be priced at the top of the Comparables. They are not for everyone. Some people want a fixer upper. I want to provide a nice, finished home, with everything new that wont have maintenance issues for a long time for a returning Vet. My Realtor friends say it isn’t going to happen, not with a VA Loan anyway.
That made me mad to hear that. I’m a Vet. And I enjoyed my Cal-Vet benefit purchasing my first home many years ago. I dont remember any difficulties. I think a lot of Americans agree with me that our Veterans should get preferential treatment…..And it seems that they are actually getting discriminatory treatment. I have three questions which I will be getting the answers for over the next few months
1. Is this poor treatment of our Vets system wide, or is our local situation in Central California an anomaly. (4 out of 5 Realtors I asked rolled their eyes when I asked about VA financing and confirmed the situation described by the first friend that I asked.) How about other areas of the country? Are they more Vet friendly?
2. What can be done to improve the situation for Veterans? Who are the Advocates that work to improve things for our Veterans?
3. Is the Congress and the Obama Administration aware that the VA is treating our Veterans so poorly? And that the VA program has such a bad reputation in the Real Estate Community? Will any politician stand up and be a champion for Vets? It seems that the VA is a bureaucracy that could benefit from some red tape slashing and streamlining……. (that should be politically popular these days)
Please respond if you have any good ideas or contacts. Hopefully together we can turn the VA Loan back into a blessing instead of a curse that it has become.
April 1st, 2009
Investing: The best days to buy
I have found that I get my best bargains in one of two times: Either the first day that a listing hits the market, or after many months. First response has worked well for me, as has being the first one in after a price reduction. So the maxim is true, “The early bird gets the worm.”
On the other end of the spectrum the listing that has sat around for a long time can be a good deal as well. Maybe it was over priced at the beginning. I buy mostly foreclosures to do my Energy Wise Renovations and it seems that some banks are having difficulty coming to terms with what has happened to the value of all that collateral that they have foreclosed on. Sometimes 6 or 8 or 10 months is needed for them to get reasonable. Not only has the market gone down further in that time, the property may have sustained vandalism, graffitti and at least more deferred maintenance. Add to this the pressures that go on inside a bank REO department and you can see why sometimes these old listings sell at half of their original listing price.
The other reason that a listing will stay around a long time is that it may be a really ugly house. Really beat up. Boarded up, broken windows, graffitti, illegal additions, meth lab, mold, etc. And a lot more work than a normal “carpet and paint” investor is willing or capable of doing. These are where I have found my most profitable deals of all. It’s all about value added. If a whole lot of value must be added, and you and your team are willing and able to do it and the others aren’t, you can leave the competitors behind and charge a lot for all that value that you added, assuming that you can buy it right. Today I visited the ugliest house I ever bought. It’s in its final weeks of renovation and will turn the biggest profit I’ve ever made. I’ll post about it soon with some before and after pictures.
So I like the first day and toward the last day of a listing. But there is another time that I am learning how to find. That is before the first day of MLS listing. It depends on relationships and I am beginning to build them. I will post here for fellow investors when I have developed some successful systems at this.
If you click the images they will expand to full size. It’s our standard 4 page brochure which is more extensive than the standard one page photocopy provided by most realtors. It’s our job to “Make The Invisible, Visible” and this page really earns its place when the prospective buyers are conferring later, comparing the homes their Realtor has shown them. This is their crib sheet to remind them that they made a good decision to buy this home! It competes well against the one page Quickie Brochures that they collected at the other homes.Of course these last two pages help the buyer justify their decision. None of us want to make poor decisions and pay too much. With these pages we are showing them that others are making similar decisions in the same neighborhood.“McMansion” Era Coming To An End?
“McMansion” Era Coming To An End? So wondered a recent Wall Street Journal article. Read it Here.
Slimming Down. Compare the floor plans of a boom-era luxury home and a smaller, post-recession design.
You can recall the history of homebuilding by taking a driving tour in your city. What you’ll notice is that there has always been a small percentage (5-10) of the “Grand Old Homes” Mansions or Near Mansions, and then the rest of the housing stock. In my town of Fresno, CA the Grand Old Homes were on Huntington and Van Ness Boulevard in the early 1900s. Two Stories with 4ooo square feet or more was the order of the day. (Today these are nightmares to renovate from an energy efficiency perspective. Those desiring to do so should view Tom Hanks movie “The Money Pit” and have plenty of patience and cash and check with the Historical Society before proceeding.
During that time, the rest of the town built in the Craftsman and Bungalow style. Two bedroom, one bath from 700 to 1000 feet was the norm with some larger homes having 3 bedrooms and sometimes 2 baths. There were larger homes between the two extremes, but not that many.
(From the WSJ Article) At 2,450 square feet, this new Wieland home in North Carolina looks like a cottage compared with some of the 3,900-square-foot models down the road.
The Housing Boom that came with the Baby Boom after WWII brought a new invention to the market: The American Classic Tract Home, 3 bedroom, 2 bath, 1100 to 1500 square feet moving up to about 2000 square feet as the century closed out.
But along with it came the “Executive Home” aka McMansion. These have the things necessary to impress, not just to live.
Grand Entries with Grand Architectural Staircases
All the Rooms are larger than they need to be, and there are more of them.
As many Baths as Bedrooms is common. Walk-in closets larger than your bedroom growing up.
All the Ceilings are taller than they need to be and they are mainly different from each other
Home Theaters and Gyms and 3 to 5 car garages.
European Chef’s style Kitchen with commercial appliances
And a huge energy bill to go with it….Because these opulent shrines to impressing the neighbors weren’t built any better than their smaller cousins. Actually the smaller home is harder to do poorly and easier to fix than the McMansion. And the McMansion with its architectural wizardry is very easy to get wrong from an energy and comfort perspective.
So here’s the good news:
1. There is going to be a huge opportunity for Home Performance Contractors to fix McMansions.
2. Another huge opportunity is doing a complete EnergyWise Renovation on the All American Tract Home. These homes are actually drawing many of the Baby Boomers who have had the McMansion and are tired of keeping them up
Well Done Complete Energy-Wise Renovations Are In High Demand & Sell Quickly
With Mature Landscaping, all automatic, a new 40 year roof that will outlast them, all new appliances, all new HVAC, Energy Saving Windows and fixtures and paint inside and out and all new tile and floor coverings, what’s to not like about that for easy living? In my experience these renovations are in high demand and sell quickly at full price.
In California there will soon be money available to fund both of these opportunities with the AB 811 funds for Energy Retrofits. There are sites about fixing McMansions. (Check out CBPCA.org for a list of trained Home Performance Contractors) This site will continue to focus on Energy Wise Renovation of moderate sized homes, especially on the Golden Opportunity presented by Foreclosed Homes.
Back to the WSJ article: I didn’t get the impression that the McMansion builders were going away. Or that the buyers demanding the Big House have learned their lesson and changed for good. It seemed they both are pulling back only as much as they have to and a recovered economy would launch them into new realms of opulence. Did I read that into the article? or did you get the same impression? Let me know in the Comments section.
September 6th, 2009
Next “Wave” of Foreclosures: Fact or Fiction? (Dont Hold Your Breath)
We’ve all been told that there’s another “Wave” of foreclosures coming and I’ve even done some of my own planning based on that prediction. Almost all of the people I’ve heard the next “wave theory” from were just repeating what they had heard from someone else. The more thoughtful of these pointed to the continuing rise in Notices Of Default but we all scratched our heads because the expected actual foreclosures didn’t show up on the REO market. What happened? The foreclosures seemed to get lost on their way to the MLS…
I had nothing objective to base it on but just started losing my faith in the Foreclosure Wave theory a few months ago. Then I finally found an objective explanation of why the foreclosures aren’t showing up on the expected schedule. Check out this chart which shows what happened to foreclosures after Secretary Paulson’s Troubled Asset Relief announcement last September 19th. Here it is on the chart, courtesy of Sean O’Toole of Foreclosure Truth.com.
Before and After Secretary Paulson's announcement on Sept 19, 2008
O’Toole explains, “While many will point out this was necessary to keep home loans available and interest rates low, I think it also clearly sent banks a message… you will get more for these assets from the taxpayer than you will through foreclosure. Add to that the mark-to-model rule changes from the Federal Accounting Standards Board, and a ton of politicial pressure and it should be no surprise to anyone that foreclosures have slowed. The drop in foreclosure sales defies logic given the continued increase in properties scheduled to be foreclosed on. But defying logic to do what is politically expedient while simultaneously inflating bank earnings and bonuses and without regard to future consequences IS the new normal. We are yet again trading tomorrow for today.” (Full Article here)
Whether O’Toole’s analysis is right or wrong, the fact remains, Investors can no longer choose from many available foreclosures like in the “old days” of 6 months ago. I believe there are still good deals out there, we just have to look harder for them. The larger spread from buy to sell which is available in foreclosures is what allows me to do large energy saving packages in the renovation and still sell my projects to first time buyers. So even if the good deals are harder to find, they are worth the effort. Here are three techniques that I’m using while waiting for the wave.
1. Increased attention to Short Sales. As you know these can take a long time, so it’s good to have a lot of offers in the pipeline. My broker and I have turned our attention to Short Sales and recently got one (after 5 months)
My Newest Really Ugly House
2. Remember the Ugly House. The house that I just put in escrow last week may qualify for the “Ugliest House” award. Certainly in the City, Maybe the State. My perfect plan is to buy the Worst House in the neighborhood and make it the Best House in the neighborhood. We call it our Cinderella Process. I’ll be showing pictures and talking about my latest Ugly House on the RoundTable Conference Calls every Tuesday at 6pm Pacific. Sign up on the FREE WEBINAR form and I will send you the slide deck before the Conference Call.
3. More Conventional Ways Of Finding Motivated Sellers. We’ve really gotten spoiled this last year with such easy pickings in the REO market. It’s time to dust off some of the harder ways to find those great deals. Pre foreclosure letters, signs, working with attorneys…. none of which are my specialty, but I will post here and we can learn together.
The effort is worth it and we need really good deals if we are going to Save The Planet, One House At A Time thru Energy-Wise House Flipping.
And who knows. The political winds and banking rules may change and the “Wave” may really come. Wise investors will have a little cash available for the buying party when it’s Wave Season.
August 10th, 2009
Found: New Ally For Vets Concerns: Craig of CraigsList
Market Street in San Francisco
It’s great when you meet people of kindred spirit in places you weren’t expecting. I attended the Inman Connect Conference in San Francisco last week expecting to meet a lot of geeks, programers, and architects of Web 2.0. and the Social Media explosion. Which I did.
But perhaps my most valuable contact was Craig Newmark, founder of CraigsList. I was happy to learn of his concern for Veterans. His reach of course, is greater than this humble blog, but his heart and approach is the same as here at GreenEarthEquities — to give our gifts away for free for good causes. I look forward to contacting him in the next few weeks about some new Vets niche market ideas.
The conference was all about where Real Estate and Technology Connect. With over 100 presenters and almost 2000 attendees, it was a GeekFest for sure. Lot’s of new technology which will be showing up here in weeks to come.
Two Teams of programer-developers actually built full-blown applications in two days of the conference. Coffee and Red Bull was unlimited, as the teams worked around the clock, and the crowd was amazed at the final product delivered on the last day.
Ricardo Bueno is my coach for building this Blog!
There were tons of great Tech Sites presented, but here’s just one to bookmark. (More later.) MyTechOpinion is all about technology for Real Estate Investors, and Realtors. It is run by Nichole and Reggie Nicolay, a husband and wife team and has lot’s of great content. One resource to check out is the “Tweet Plan 2.0″ where Nichole likens sending out regular bits of information to your network to Drip Irrigation. Here’s the HomePage: http://www.mytechopinion.com/
Inman Connect is the twice a year conference and Inman News is the daily e-news which is all about Real Estate and Technology. Like most e Journalism these days, the entry level subscription is free. I think the premium service is worth the cost for serious investors.
June 18th, 2009
Who knew? We treat our Vets so badly?
Two weeks ago I had no clue that Veterans have such a difficult time using that supposed benefit, the VA Loan. But in the last two weeks, I’ve got an education. I’ve sold one of my Energy-Wise Renovations to a Veteran. We’ve been working with his wife all along during renovation on design and color selection etc. Now it seems that the family is not going to qualify and I’ve found out that both the credit and appraisal process for Vets is more difficult than either conventional or FHA financing. When I started asking my Realtor friends about this, they all said, “Yes, VA has always been difficult. We shudder when a buyer wants to go VA. We’ll probably spend a lot of time and then the Vet will be disqualified or the house wont appraise and we’ll have to start all over.”
It seems that my GreenEarthEquities projects will never qualify and meet the VA appraisal. With the Wow! Package, the Done! Package and the Energy Package, these homes have all new everything and need to be priced at the top of the Comparables. They are not for everyone. Some people want a fixer upper. I want to provide a nice, finished home, with everything new that wont have maintenance issues for a long time for a returning Vet. My Realtor friends say it isn’t going to happen, not with a VA Loan anyway.
That made me mad to hear that. I’m a Vet. And I enjoyed my Cal-Vet benefit purchasing my first home many years ago. I dont remember any difficulties. I think a lot of Americans agree with me that our Veterans should get preferential treatment…..And it seems that they are actually getting discriminatory treatment. I have three questions which I will be getting the answers for over the next few months
1. Is this poor treatment of our Vets system wide, or is our local situation in Central California an anomaly. (4 out of 5 Realtors I asked rolled their eyes when I asked about VA financing and confirmed the situation described by the first friend that I asked.) How about other areas of the country? Are they more Vet friendly?
2. What can be done to improve the situation for Veterans? Who are the Advocates that work to improve things for our Veterans?
3. Is the Congress and the Obama Administration aware that the VA is treating our Veterans so poorly? And that the VA program has such a bad reputation in the Real Estate Community? Will any politician stand up and be a champion for Vets? It seems that the VA is a bureaucracy that could benefit from some red tape slashing and streamlining……. (that should be politically popular these days)
Please respond if you have any good ideas or contacts. Hopefully together we can turn the VA Loan back into a blessing instead of a curse that it has become.
April 1st, 2009
Investing: The best days to buy
I have found that I get my best bargains in one of two times: Either the first day that a listing hits the market, or after many months. First response has worked well for me, as has being the first one in after a price reduction. So the maxim is true, “The early bird gets the worm.”
On the other end of the spectrum the listing that has sat around for a long time can be a good deal as well. Maybe it was over priced at the beginning. I buy mostly foreclosures to do my Energy Wise Renovations and it seems that some banks are having difficulty coming to terms with what has happened to the value of all that collateral that they have foreclosed on. Sometimes 6 or 8 or 10 months is needed for them to get reasonable. Not only has the market gone down further in that time, the property may have sustained vandalism, graffitti and at least more deferred maintenance. Add to this the pressures that go on inside a bank REO department and you can see why sometimes these old listings sell at half of their original listing price.
The other reason that a listing will stay around a long time is that it may be a really ugly house. Really beat up. Boarded up, broken windows, graffitti, illegal additions, meth lab, mold, etc. And a lot more work than a normal “carpet and paint” investor is willing or capable of doing. These are where I have found my most profitable deals of all. It’s all about value added. If a whole lot of value must be added, and you and your team are willing and able to do it and the others aren’t, you can leave the competitors behind and charge a lot for all that value that you added, assuming that you can buy it right. Today I visited the ugliest house I ever bought. It’s in its final weeks of renovation and will turn the biggest profit I’ve ever made. I’ll post about it soon with some before and after pictures.
So I like the first day and toward the last day of a listing. But there is another time that I am learning how to find. That is before the first day of MLS listing. It depends on relationships and I am beginning to build them. I will post here for fellow investors when I have developed some successful systems at this.
Before and After Secretary Paulson's announcement on Sept 19, 2008
My Newest Really Ugly House
Found: New Ally For Vets Concerns: Craig of CraigsList
Market Street in San Francisco
It’s great when you meet people of kindred spirit in places you weren’t expecting. I attended the Inman Connect Conference in San Francisco last week expecting to meet a lot of geeks, programers, and architects of Web 2.0. and the Social Media explosion. Which I did.
But perhaps my most valuable contact was Craig Newmark, founder of CraigsList. I was happy to learn of his concern for Veterans. His reach of course, is greater than this humble blog, but his heart and approach is the same as here at GreenEarthEquities — to give our gifts away for free for good causes. I look forward to contacting him in the next few weeks about some new Vets niche market ideas.
The conference was all about where Real Estate and Technology Connect. With over 100 presenters and almost 2000 attendees, it was a GeekFest for sure. Lot’s of new technology which will be showing up here in weeks to come.
Two Teams of programer-developers actually built full-blown applications in two days of the conference. Coffee and Red Bull was unlimited, as the teams worked around the clock, and the crowd was amazed at the final product delivered on the last day.
Ricardo Bueno is my coach for building this Blog!
There were tons of great Tech Sites presented, but here’s just one to bookmark. (More later.) MyTechOpinion is all about technology for Real Estate Investors, and Realtors. It is run by Nichole and Reggie Nicolay, a husband and wife team and has lot’s of great content. One resource to check out is the “Tweet Plan 2.0″ where Nichole likens sending out regular bits of information to your network to Drip Irrigation. Here’s the HomePage: http://www.mytechopinion.com/
Inman Connect is the twice a year conference and Inman News is the daily e-news which is all about Real Estate and Technology. Like most e Journalism these days, the entry level subscription is free. I think the premium service is worth the cost for serious investors.
June 18th, 2009
Who knew? We treat our Vets so badly?
Two weeks ago I had no clue that Veterans have such a difficult time using that supposed benefit, the VA Loan. But in the last two weeks, I’ve got an education. I’ve sold one of my Energy-Wise Renovations to a Veteran. We’ve been working with his wife all along during renovation on design and color selection etc. Now it seems that the family is not going to qualify and I’ve found out that both the credit and appraisal process for Vets is more difficult than either conventional or FHA financing. When I started asking my Realtor friends about this, they all said, “Yes, VA has always been difficult. We shudder when a buyer wants to go VA. We’ll probably spend a lot of time and then the Vet will be disqualified or the house wont appraise and we’ll have to start all over.”
It seems that my GreenEarthEquities projects will never qualify and meet the VA appraisal. With the Wow! Package, the Done! Package and the Energy Package, these homes have all new everything and need to be priced at the top of the Comparables. They are not for everyone. Some people want a fixer upper. I want to provide a nice, finished home, with everything new that wont have maintenance issues for a long time for a returning Vet. My Realtor friends say it isn’t going to happen, not with a VA Loan anyway.
That made me mad to hear that. I’m a Vet. And I enjoyed my Cal-Vet benefit purchasing my first home many years ago. I dont remember any difficulties. I think a lot of Americans agree with me that our Veterans should get preferential treatment…..And it seems that they are actually getting discriminatory treatment. I have three questions which I will be getting the answers for over the next few months
1. Is this poor treatment of our Vets system wide, or is our local situation in Central California an anomaly. (4 out of 5 Realtors I asked rolled their eyes when I asked about VA financing and confirmed the situation described by the first friend that I asked.) How about other areas of the country? Are they more Vet friendly?
2. What can be done to improve the situation for Veterans? Who are the Advocates that work to improve things for our Veterans?
3. Is the Congress and the Obama Administration aware that the VA is treating our Veterans so poorly? And that the VA program has such a bad reputation in the Real Estate Community? Will any politician stand up and be a champion for Vets? It seems that the VA is a bureaucracy that could benefit from some red tape slashing and streamlining……. (that should be politically popular these days)
Please respond if you have any good ideas or contacts. Hopefully together we can turn the VA Loan back into a blessing instead of a curse that it has become.
April 1st, 2009
Investing: The best days to buy
I have found that I get my best bargains in one of two times: Either the first day that a listing hits the market, or after many months. First response has worked well for me, as has being the first one in after a price reduction. So the maxim is true, “The early bird gets the worm.”
On the other end of the spectrum the listing that has sat around for a long time can be a good deal as well. Maybe it was over priced at the beginning. I buy mostly foreclosures to do my Energy Wise Renovations and it seems that some banks are having difficulty coming to terms with what has happened to the value of all that collateral that they have foreclosed on. Sometimes 6 or 8 or 10 months is needed for them to get reasonable. Not only has the market gone down further in that time, the property may have sustained vandalism, graffitti and at least more deferred maintenance. Add to this the pressures that go on inside a bank REO department and you can see why sometimes these old listings sell at half of their original listing price.
The other reason that a listing will stay around a long time is that it may be a really ugly house. Really beat up. Boarded up, broken windows, graffitti, illegal additions, meth lab, mold, etc. And a lot more work than a normal “carpet and paint” investor is willing or capable of doing. These are where I have found my most profitable deals of all. It’s all about value added. If a whole lot of value must be added, and you and your team are willing and able to do it and the others aren’t, you can leave the competitors behind and charge a lot for all that value that you added, assuming that you can buy it right. Today I visited the ugliest house I ever bought. It’s in its final weeks of renovation and will turn the biggest profit I’ve ever made. I’ll post about it soon with some before and after pictures.
So I like the first day and toward the last day of a listing. But there is another time that I am learning how to find. That is before the first day of MLS listing. It depends on relationships and I am beginning to build them. I will post here for fellow investors when I have developed some successful systems at this.
Investing: The best days to buy
I have found that I get my best bargains in one of two times: Either the first day that a listing hits the market, or after many months. First response has worked well for me, as has being the first one in after a price reduction. So the maxim is true, “The early bird gets the worm.”
On the other end of the spectrum the listing that has sat around for a long time can be a good deal as well. Maybe it was over priced at the beginning. I buy mostly foreclosures to do my Energy Wise Renovations and it seems that some banks are having difficulty coming to terms with what has happened to the value of all that collateral that they have foreclosed on. Sometimes 6 or 8 or 10 months is needed for them to get reasonable. Not only has the market gone down further in that time, the property may have sustained vandalism, graffitti and at least more deferred maintenance. Add to this the pressures that go on inside a bank REO department and you can see why sometimes these old listings sell at half of their original listing price.
The other reason that a listing will stay around a long time is that it may be a really ugly house. Really beat up. Boarded up, broken windows, graffitti, illegal additions, meth lab, mold, etc. And a lot more work than a normal “carpet and paint” investor is willing or capable of doing. These are where I have found my most profitable deals of all. It’s all about value added. If a whole lot of value must be added, and you and your team are willing and able to do it and the others aren’t, you can leave the competitors behind and charge a lot for all that value that you added, assuming that you can buy it right. Today I visited the ugliest house I ever bought. It’s in its final weeks of renovation and will turn the biggest profit I’ve ever made. I’ll post about it soon with some before and after pictures.
So I like the first day and toward the last day of a listing. But there is another time that I am learning how to find. That is before the first day of MLS listing. It depends on relationships and I am beginning to build them. I will post here for fellow investors when I have developed some successful systems at this.
Solar PV System for 3405 N. Miami
Interior 3405 N. Miami, Fresno CA
Exterior 3405 N. Miami, Fresno CA
3332 N Ezie $165,000 PENDING
5967 E Fedora $160,000 Pending
3328 N Purdue SOLD
145 Gettysburg SOLD
5741 E Bernadine SOLD
5664 E Bernadine SOLD
4440 N Eddy SOLD
3915 E Townsend 135K Pending
