In October of 2010 I decided I was going to start building a rental portfolio to help me create a passive income that would eventually be higher than my monthly expenses and hence enable me and my family to “Get from the rat race” and become “Financially Free”
Yet after buying 12 rental properties in 4 months I and both my private money lenders were utterly out of funds.
I could concentrate on raising more capital to try and buy more rental properties, but I ‘d bills to pay and time was against me. In the end, these rental properties were merely making a few hundred dollars in monthly income! So as a temporary repair I determined to sell four of the properties which I ‘d yet to rent.
Besides giving me back my personal invested capital, in addition, it enabled me to reuse my private investors capital, and I made enough income to care for my monthly demands for at least per year! In addition, it got me understand the incredible return on my investment (as well as monetary independence) that may come from switching houses.
I was solicited! I simply had to keep switching houses once I understood the chances of how fast I could create financial independence and riches!
So that’s when a significant question began forming in my own head.
You see, I ‘d read publications like the E-myth and the 4 Hour Work Week, and I comprehended the power of leveraging systems to streamline a company. Could I create a company which works for me, instead of me working for the company?
Fast forward to today, and I am happy to report that since inquiring myself this important question we’ve flipped over 250 houses and I now spend a mean of about 5 to 10 hours per week on my house turning company!
Just by using one of these simple tricks you’ll be able to save yourself countless hours in your company and drastically raise your quantity and income. So, let us get to it!
Before getting into this first one I would like to simply say that if you’re a brand new house flipper comp as numerous houses as it is possible to and you may need to examine! Learning just how to examine approximation repairs and prices is vital if you’re going to become successful in this company! You can not instruct someone else to what you do not understand! So, for the benefit of the place we’ll suppose that you just understand that that is an important ability to learn before you’ll be able to instruct others what to search for.
For the remainder of you with more expertise, over time you may have to let others help you do some of the leg work. That is vital if you are interested in being successful in this company. I understand a lot of investors who hop on the MLS every day looking at firing and listing outside offers in hopes of getting a deal. Or perhaps their representative is sending listings on the MLS which they submit offers on, examine and subsequently comp outside to them.
And yet these same investors wonder why they have been unable to focus more attention on their company and purchasing so few properties! You will need to get others to do that leg work for you! You should just be looking at prices when other folks have done the first acquisition research do the job.
In my own company, any representative or wholesaler who brings us a deal should have done one or more of two things:
1) The deal either must be under contract
2) They have computed the ARV, estimated repairs and developed the offer according to our standards.
Sure, we’ll work together at the start of our relationship until we feel assured they understand what we’re seeking. But we pride ourselves on ensuring wholesalers and our representatives understand since they should understand that specific place extremely nicely and precisely what type of price we’re seeking, presumably their ARV should be equally as great or better than ours.
This one trick permits us to save literally countless hours, from making offers, examining prices and sifting through properties. Understanding that, in this company, most of your offers will not be going to get taken in the get go, it is a substantially better use of your time to concentrate on the properties after they’ve been tied up and underneath contract.
We do not have to stress too much, since we constantly have our review interval to fall back on just in case someone did mess up along the way. Since we do a superb job on being incredibly clear about our standards right from the start but luckily that is seldom true.
This one trick enables one to 10x your company increase. Surprisingly, a lot of seasoned investors don’t perform on this one! With the value acquisitions play in house flipping, if you are interested in being successful in this company that is an extremely significant point to stress!
2) Use a Rehabilitation Price List
Most investors understand your rehabilitation procedure should be streamlined by you through the use of the exact same stuff on as many houses as possible, but not many use a price list!
When I began rehabbing properties on a bigger scale I began to see many likenesses on the bids we received.
Eventually I saw other likenesses for fixtures, tile, exterior paint, counters, cupboards, carpeting and much more. Undoubtedly this was not any great for us or the contractor!
So, we developed a price list!
Costs never creep up. The contractor does not have to wonder if he is going to get the job based on his bid. And we never need to get greater than one bid.
This saves a lot of worry and time! Sometimes there are a number of little things which might come up, but those are easier to focus on when you’ve got all the other things work out beforehand.
3) Set those agents to work!
These days I seldom look at the houses I purchase, and also my helper does not look at a lot of them anymore. (And, no, I do not have a project manager!)
I ‘ve come to the decision the mixture of agent and a GC are substantially more efficient and perfect as a project manager! Plus it saves a project manager’s wages being paid by me or giving up added gains.
My brokers sell them for me, record them, and do not simply make offers on houses, but they also help handle my house switching jobs!
Yes! My representatives handle my jobs!