It’s your first time flipping a house, and it’s almost ready. Now what?
That’s a question we hear a lot. While our business model is mostly wholesale properties, we will flip six or eight houses a year and have learned you have to start marketing the properties even before the rehab begins.
While the market is good in Greensboro, N.C., where we own Citygate Homes, LLC, a HomeVestors (“We Buy Ugly Houses”) franchise, it’s not on fire like some areas. Because of that, we try to make our houses stand out from the crowded field, and they usually sell in the first week with multiple offers.
HERE’S HOW WE DO IT
John is the primary house buyer, and Corinne wears multiple hats as office manager, designer and project manager. That’s more than enough to keep us going seven days a week.
We begin marketing our houses the day we get them under contract. We introduce ourselves to all the neighbors and let them know what will be going on during the next two months of construction. We also ask if they know anyone who’s looking to buy this house, or maybe sell the one they’re in. We have gotten several contracts both on the buy and sell sides just from spending an hour or two in the neighborhood.
John’s background as a commercial photographer helps our marketing effort, too.
The day we start the project, a “Coming Soon” sign goes in the front yard. John begins by taking tons of photos, both inside and out and at different times during construction. We stage every rehab, so he tries to imagine how it will look when Corinne places the furniture and the house is finished.
SOCIAL MEDIA PLAYS A BIG ROLE
We wait until we are halfway into the project before we start posting the progress of the job on our Facebook page. This helps compress the eight-week project into three or four and builds the frenzy we’re used to in the final week or so. People love to see the “before and after” pictures and want to see the house in person. Realtors send potential buyers to our social media sites to watch the progress, too.
We credit that social marketing push with the crowd of 80 to 100 people who typically show up at the open house when the property goes on the market.
Open house day for us is a “good kind of crazy,” as Corinne says. After eight weeks, it all comes down to people walking through the house and liking what they see. It’s why we love this business.
USE MULTIPLE STRATEGIES
Because of our volume of houses (60 this year) we use multiple strategies for selling a property.
We are continuously building our buyers list from incoming phone calls, networking, Meetup groups and our local REIA members. We wholesale a lot of properties using MailChimp and our database of investors and through Greensboro Deal Makers Sessions. Deal Makers is a venue sponsored by local HomeVestor franchisees at which wholesale off-market (non-MLS) properties are presented. Generally, these draw 65 to 85 attendees, and we’ve sold at least one house at every meeting since December 2014.
We also use Craigslist, Zillow, Trulia and of course the MLS. When we get a property under contract, we work on the best exit strategies for the house. Whether it’s a fix-and-flip, wholesale, “wholetail,” assignment or buy-and-hold, we always try to stick with our first choice.
We do a lot of what we call wholetail, which is a hybrid of wholesale and retail. We fix all the big-ticket “scary” items like HVAC, roof, foundation and then put the property on the MLS for a reduced price and let the future homeowners put in their sweat equity.
Our advice is to know your neighborhoods and your customers and pick the best end buyer for the property. That will determine the exit strategy and put you on the path for success.
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