The Science of Flipping - Episode 15: Quick Tip – Holiday Season Slow Down | Real Estate Investing Podcast

Episode Date: November 29, 2013

document.addEventListener("DOMContentLoaded", function () { podlovePlayer("#player-5eb5ab3253a6e", "https://thescienceofflipping.com/wp-json/podlove-web-player/shortcode/post/357", "https://thescienceofflipping.com/wp-json/podlove-web-player/shortcode/config/default/theme/default"); }); <p>[podlovevideo src=”http://thescienceofflipping.com/audio/Podcast-15.mp4″ type=”video/mp4″ duration=”” title=”Real Estate Investing Podcast – Episode 15 | Quick Tip – Holiday Season Slow Down”]</p> With the Holiday season upon us, buying tends to slow down. Justin gives you a great idea on how to make sure you create some sort of income during the buying slow down. Don’t let the fact that homes aren’t flying off the MLS be the reason for you going in debt or losing all the profit in your flips.. Don’t miss this.

Hey guys, welcome to the Science of Flipping podcast episode 15. I can't believe we're already at episode 15 already. Today guys, this is your flip tip or your quick tip. We are going to be talking about what to do in this holiday season or even break it down to say what happens when buyers slow down their buying and what to do so guys this is gonna be a good one it'll be a quick tip a flip tip again if you have not gone over to the website the science of flipping calm and if you have not downloaded our number one ebookbook, The 15 Most Costly Effects a Real Estate Investor Can Make,

you got to get there. You got to go over and download your free e-book of the 15 Most Costly Mistakes an Investor Can Make. It's over at our website, thescienceofflipping.com. If you are new to the podcast, this podcast is all about helping fix and flip real estate investors systemize their business so they don't have to work in their business day after day so that they can get out of the minutia of their business so that they can continue to be fix and flippers. Whether they're sitting on the comfort of their own couch, whether they're in their office, whether they're on vacation, traveling the world, you can still run a fix and flip business without having to be

in your business each and every day. That is what our podcast is about. It's a free podcast here on iTunes. So make sure to download each and every one of our podcast episodes so you can get all the systems that we use here at Phoenix Wealth Builders so you can systemize your business to live the life that you want to be living. If you don't know me, I'm your host, Justin Colby. I am the founder and president of Phoenix Wealth Builders, also of the Science of flipping. And we have been flipping for years and we've been flipping since 2007. And guys, it hasn't always been puppy dogs and rainbows. At this very moment, we are in a 1500, 1700 square foot office. We are doing very well for ourselves, but it hasn't always been this way. We have taken our lumps. We got started in 2007, which was a time where

short sales were very rampant and the banks really didn't know what they were doing. So it took us a long time to get our first deal done. We didn't get our first deal done for the first nine months and we didn't make that much money when we got our first deal done. We got our second deal done within the next couple months, but really, we made $20,000, $25,000, $30,000 in the first year of business. Me and my business partner, Eddie, we had to divide that in half. We had to get taxes taken out. It wasn't a livable income. We were adults. We had bills to pay. We ended up losing our homes, losing cars. We went through a very difficult time in life. But the reason why now I give you all this information for free on this podcast is simply because we've been through it.

We've been through the hard times and we want people to understand what to do and what not to do so that they don't have to go through the hard times. We fought through and now we flipped 96 homes last year. We flipped 50 something homes this year. And we're also became, we became this year, developers and builders. We're building 79 townhomes out in Mesa, Arizona. We're very excited about that. You know, and it's currently going on right now. We have our first building up and constructed.

We're working on our second building. And we're in pre-sale mode out here in Mesa, Arizona. It's an exciting time for us here. So anyways, that's who we are. I'm your host, Justin Colby, and let's just get right to it, right? This is a quick tip. This is a quick tip for your flips. A lot of investors seem to struggle during the holiday times because a lot of buyers back off. You know, a lot of people have their lives, they have families, they're traveling, they're not really working hard to acquire properties. And we see that here in Phoenix and we see in California

and we see it in New York. All of our students are seeing this same thing every holiday season. And whether it's the holiday season or if you even wanna say a seasonal I'm trend that happens you need to start thinking outside the box what to do with the inventory you currently have you see here we have five six maybe even seven current listings that now we understand if they're not in contract right now we're gonna probably have to get through December and possibly even January

before buying starts really ramping up again so some of the decisions we make is we start looking about putting renters in that home and I understand if you're in California or higher price point areas they aren't meant to be rental properties and even our properties aren't meant to be rental properties and even our properties aren't meant to be rental properties. But at the end of the day, if you can put a renter in on a month to month lease and get some of that rental income in, whether you're stopping the bleeding or at least getting some income driven into your pockets for the month or two or even three, that is a better alternative than to just let the home sit in hope and cross your fingers. Hope is not a strategy. Hope is not a system that you can just let and sit on the

market and not have any income coming in. If you have a loan on that property, you are making a payment every month. Don't sit there and just make up all the payment. Put a renter in for month to month. It may not cover the whole payment, but it slows down the bleeding. It slows down or limits how much you're bleeding if it doesn't stop it altogether. In Arizona, a lot of times it can actually stop the bleeding altogether and or even possibly be a resource for revenue. Get a renter in there for a couple months an added value to that guys is you then take it off the MLS let the MLS regenerate I know here in Arizona you have to have a property off the MLS for a minimum of 90 days

before you can relist that same property with the days on market being zero. Well, so what we will do is we will throw a renter in there. We'll take it off the MLS. We'll collect the rental income. We'll wait 90 days. 90 days from today would be mid-February. And we put it right back on the market there in spring, right when buyers are back, right when everyone's ramping up their buying for a great time. Now, if you live here in Phoenix, this is great for snowbirds as well, right? So you can look at this as a holiday struggle. During the holidays, inventory doesn't move as quickly or maybe even a seasonal struggle. But the answer would be if you're sitting on inventory, don't just sit and cross your fingers.

Don't just lower your price to a point of losing a bunch of money just to get it gone. Why don't you put a renter in month to month? That way you're not in a long contract. Wait the 90 days. Make sure you're paying your note if you have one. Make sure you're not in a long-term lease. And that way, your MLS listing will rejuvenate after that 90 days, meaning you can relist it 90 days later with zero days on market. Guys, that's your quick tip, your flip tip here from the science of flipping. I'm glad that every so often I'm able to show my face and show you our office here at Phoenix Wealth Builders in Phoenix.

And I look forward to giving you another quick tip here soon. Talk, guys.