In a past post I stated there was no money in fixers or flipping property which is very true. There is however a strategy here that many people have over looked for many, many years. I’m working on a deal right now that is a case on point.
If you read the article
you’ll see some disturbing assumptions made by the writer. What’s happened here in Seattle Washington is that the news media has been catering to the Real Estate companies, Windermere especially. The news media is losing ad revenue and Real Estate is one of it’s biggest ad buyers, so the news papers are printing press releases without checking facts.
Lack of rental units, bad design, crappy construction, and the inability of police or fire access into a town house development aren’t the issue for this blog. Towards the end of the article a sucker talks about selling a house to buy a town house because the town house is new and doesn’t need any work.
You may know that construction is an old boys network. All of these guys are greasing each other up to turn out a high profit crap product. These guys also go after other guys who don’t play ball with the intent of taking them out of the game. These tough guys in turn rip off any one stupid enough to buy a new construction product, which is just like the next one, that is similar, only different, than the one before.
In the article you may notice the term slab granite and stainless steel appliances. It took me a long time to come around to the slab, stainless mind set, but it is what people buy. When you use these appointments it’s easier to skimp on higher cost items. To do a cabinet and appliance package you can probably do that yourself. It’s a no brainer with a level, some time, and a screw gun. OOPS??!! Did I let that out of the bag? The granite is done by a fabricator who does charge by the square foot. A good fabricator like Marmo Granito off of Aurora used to be able to charge what they wanted. It’s like anything else. With competition the price goes down. As the price goes down the product we buy becomes cheaper.
Just as stainless steel in the United States has less nickel content granite is graded. You’re not buying today what you could have even three years ago. The fabricators are telling you that they have a better product do to a volume business which is another load of crap. Granite is also measured by thickness. Just like lumber which used to be dimensional, where one inch meant one inch, todays granite has gotten thinner.
Enough said on that. The sucker selling the house has a very good point. His house is in disrepair. In the article it talks about a house being only twenty, thirty , or fifty thousand dollars more than a town house. What a bargain? In time when the sucker goes to paint his crappy little town house he’ll get permission. I like orange myself. The sucker will be talking with his neighbors comparing crappy construction stories while I change the color of my house.
The sucker and his neighbors will be in meetings talking lawsuits while the town houses fall apart and I’ll be fixing or building onto my stand alone house. The thing is that I’m in the business of fixing houses, the sucker is not. He’s a victim of a self fulfilling prophecy. The town houses suck the labor pool dry by having plenty of work and profit dollars. My tile guy was being paid ninety dollars per hour to finish out some bathrooms on units that were already sold. A lot of people have gotten very rich in this process.
The good news for me or you, probably you, is that older, falling apart houses, or don’t wanters, as they are called are still a very good bargain today. The trick is getting them fixed properly then sold in a timely manner.
My hope is that over the course of the posts that I make you can get an idea of how to enter the market place and get a project house completed. My dream is that more and more of you will take on a project to not only save our cities, but to help preserve our way of life. Town houses, if they would have been done with some style, or lot placement, or something, could have been a good thing. The problem is that greedy little hustlers have expoited a land use code to generate tax revenue for our city’s Department of Planning and Development.
