Who Said "Flipping"?

By
Real Estate Broker/Owner with Daytona Condo Realty, 386-405-4408

Our beach is like Broadway in New York City. That’s where you can run into people you know. I try to walk home from my office at least once a week. It is a 4.2 mile walk on the beach and I like it. I thought that I could do it every day, but I walk barefoot and my feet need rest.

A few days ago I met a retiree, who is always asking me about real estate. He is one of those “paper” investors, who has the money, but not the courage to do it. He is always surprised how others buy real estate. It is either going up and it is risky, so he does not buy, or it is going down and he is not sure it would ever go back, so, again, he is not buying.

Flipping - Jon Zolsky blogSo, when he asked me about real estate market in Daytona Beach area, I told him that my clients among other things are flipping condo-hotel units.

- Flipping?

He was shocked. From what he reads this is not the market to flip anything. I am lucky, I do not read what he reads, so I am flipping for my clients.

- No, you can’t flip in this market.

Well, consider ignorance a bliss… Not only I can, I do flip for my clients.

My last just happened a bit more than a week ago. I received a call from someone I do not know. He said that he Googled this condo-hotel in Daytona Beach Shores, and saw that I sell most ot he units there. He told me that he is getting a unit from the Lender, and is looking to flip it at great price, but he needs to sell it within less than a week.

It was not listed, he just wanted a quick deal. I figured that this was a deal where he does a simultaneous closing or gets it assigned, and walks away with the difference.

He told me how much he wanted, and it was an excellent price. But still not for a sale within a few days for cash. I told him that I would have the buyer, if he knocks down the price a little bit more. We went back and forth and agreed on the price. At that time I did not even have a buyer. I work with several investors, and they all have their priorities, so I knew I would get a buyer, I just did not know who it was going to be.

Couple of calls, and I put together the offer, sent it to the gentleman who called me, and in 3 days we closed. When I received the HUD, it had his company name, he somehow got the Lender assign it to his company.

I told my guy that this might have to wait until late spring as the market is slowing down now. He would rather resell it now, but if he had to wait, so be it. The very first day after closing I received a call from a gentleman in South America, who not only Googled the property, but then called the resort and asked them all sort of questions, including whether they knew me and could recommend me. They did. He was calling about a different unit, but we put it under contract already, so he was late with it.

After talking to him on the phone, I gave him all the available options and this unit was one of them. I then e-mailed him all the units for sale, and all other information to help him make an informed decision. It included by blog post about this property.

He decided to go with it because it was for even better price that the one he missed, and it is not a short sale, so he does not need to wait. The fact that it is all done unseen does not bother me, as the resort was recommended to him by his friend, and the other factor is that for this price it is not a big deal anyway.

The price is a low price, but it will leave my investor with very good profit. We are closing this one in 2 weeks.

I am looking back and I see 3 transactions within one month. Not bad for a slow market.

Jon ZolskySo what about the guy I met on the Beach? No, he will wait until the market stabilizes. Can he buy something when it stabilizes? Sure, it will cost more, but he sure can…

 

 

 

 *  Image courtesy of Karen Roe via Flickr.com

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Rainmaker
621,479
Deborah Byron Leffler BzyBee Real Estate Lady!
Keller Williams Realty Boise - Nampa, ID

Love your business card....in my area it is getting pretty hard to flip propeerties as we have so many that are distressed and the banks are putting in clauses that say they can't "Flip"  doesn't make sense to me....but I don't make the rules!  LOL

Oct 31, 2010 11:46 AM #1
Rainer
321,498
Jack Mossman - The Nines Team at Keller Williams in Lodi
The Nines Team at Keller Williams in Lodi - Lodi, CA
The Nines Team in Lodi

Jon - I'm smiling .... no I'm grinning .... OK ... I'm just out loud laughing!  And the guy on the beach ... later will be asking .. "why didn't you tell me?" ... congratulations on a trifecta .... no, that'd be gambling ... these sound like a sure thing!

Oct 31, 2010 11:47 AM #2
Rainmaker
3,977,611
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

Like the card.   This is a good market to flip in.  You just have to be a bit more careful and don't expect to double your money.

Oct 31, 2010 02:37 PM #3
Rainmaker
592,907
William J. Archambault, Jr.
The Real Estate Investment Institute - Houston, TX

Jon,

Every one wants to be rich!

Every one wants to flip houses for huge profits!

Few are willing to do what it takes!

Bill

Oct 31, 2010 04:31 PM #4
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Lane Bailey
Century 21 Results Realty - Suwanee, GA
Realtor & Car Guy

Yep...  Those that wait get what's left.  Less risk = less reward.

Oct 31, 2010 04:32 PM #5
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Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Deborah - our market is very distressed, and still, opprotunities are there. And it was all cash, so anti flip provisions did not apply

Nov 01, 2010 02:32 AM #6
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Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Jack - he is asking this question. In turn, I always telll him that for these deals I need the answer right away, and when I used to send him the info, it would take him a week to think, and talk with his wife, and by the time he would call me back with "no, we arenot sure about the market", the properties were long gone

Nov 01, 2010 02:35 AM #7
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Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

William,

This investor's last two deals were:

1. Bught at foreclosure auction a unit for under $22K, paid maintenance and taxes about $11K, total cost $33K. Sold in less than 3 months for $76K, meanwhile was getting rental income (condo-hotel) and these happened to be the best months and he was very happy.

2. Bought a unit for $35,750. No extra cost besides about $400 in Closing costs. Under contract for $56K.

If that's not the best time for him, what is?

Nov 01, 2010 02:39 AM #8
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Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Bill - so many want guarantees of success in life, including flipping.

Nov 01, 2010 02:40 AM #9
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Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Lane - absolutely true. What stability? Pay more...

Nov 01, 2010 02:41 AM #10
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