No matter how good a deal might seem, and no matter how attractive the result of your rehab project, certain homes will only sell after pigs take flight. Location, location and location, yes this cardinal rule of real-estate holds for flips as well, but its more like location, location, and properties in specific areas will never sell.
• Properties next to ugly sights: Say a house flipper combs through the listings, and there’s a foreclosed home listed at, only 75 thousand, He’s looked over the description and seen some photos of the interior, the project should be short work. But when he pulls up, the looming sight of a half-naked woman proudly presenting a vodka bottle between her breasts blocks out the sun. Something the description didn’t mention: the house has an east facing exposure to a garish billboard. No matter, he will go forward as the profit projections are just too good to pass up. After work he finishes work, trodding couples argue as husbands sneak glances up at the luminous sight, they never even look at the house. No one puts in a bid at his asking price so our flipper has to sell off the property at a steep discount.
• Properties next to deranged neighbors: Another flipper finds a prospective property that is selling for only 75 K when they regular price in the area is 300. Before putting in an offer, she visits the location only to discover something smells, a strange spectacled woman dressed in sackcloth has been emptying her litter boxes into the backyard of the house. Well, 225 in resale profits it seems to be deal is just too good to pass up. Our investor calls the police and the neighbor is promptly cited. Yes, the litter box disposal activities stop but now our investors made an enemy. After work on the house is done, and buyers begin to show up, the woman is dancing, menacingly half naked on the front lawn. She calls the police again, but the woman is not doing anything illegal, she’s just humming spinning in circles, which isn’t against the law.
Will the house sell? Well unless the neighbor is involuntarily committed, it seems unlikely.
If your browsing the internet and find a deal that seems too good to be true, it probably is. No property description is going to list features like “right next to scenic high-tension wires, neon billboards or demented neighbors.” You can avoid all this risk by doing s+omething straightforward, walking through a house, even talking to the neighbors before committing to a project.
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis Dahlberg Broker/RI/CEO
NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave | Austin | Texas | 78701
About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.