Re: Advice For Your First Flip

If you live in the real world and want to be honest with yourself, it’s safe to say that on your first flip, you’re probably going to make a few mistakes.

In the next 60 seconds, let’s reduce that number of mistakes even more. And hopefully, tuck a few extra dollars into your bottom line.

Here is the number one thing that you have to get right if you are flipping a house here in the DC metro area:

The Price.

Ok, this is a little tricky, because there are actually two prices you have to get right.

There are two sides of this “Price” coin:

The price you pay for the house and the price at which you sell the house.

If you get either one wrong, there can be huge consequences. Spend too much when you buy it, or list it for too little and you won’t make a profit.

However, if you have a rising market and keep your mistakes to a minimum, you could actually walk away from closing with more money than you expect. (Lot’s of people think they are brilliant renovators, but in the last few years they have been the lucky recipient of a rising market.)

Back to these two prices. They can be tricky.

There are a lot of factors that go into flipping a property, but I’m going to assume you can get estimates on the paint, carpet and cabinets. So let’s get a little beyond those basics.

Beyond the cost of the materials and labor to have the proper repairs, where are the hidden expenses a lot of first-time flippers forget?

Let’s cover the top three items first time flippers forget that really take a bite out of expected profits.

1. Taxes.
Here in DC, we live in a high tax area. Period. When you buy and sell a property the transfer taxes and property taxes can eat into as much as 4,5 or even 6 percent of the transaction. Maybe MORE if you take a long time to turn the property around. On a simple 200k property, these taxes might add up to as much as $8, $10 or even $12 thousand dollars.

2. Insurance and Utilities
You have to insure the property, especially when you turn on electric and water. Even a small electrical fire or a cracked water pipe can cost hundreds or thousands of dollars. And we are not dealing with homeowner insurance rates when we flip property. The insurance companies are going to charge more than a homeowner because they know the house will be vacant a large amount of the time you will own it. Additional risk for them means higher rates for you.

3. Sales and Marketing
Sales and Marketing is one expense most people assume an agent will take care of. However, if you can add to the sales process by assisting in catered open houses or additional mailings to prospective buyers, you might be surprised how quickly you can get these properties sold. It’s a team effort, and when you offer to chip in for additional TARGETED marketing your sales team will be grateful.

These three items should always be factored into the price of buying and selling a property in the DC metro area. Especially the taxes. So many first timers are surprised how much it costs just to DO the transaction.

There are a few more tricky or hidden expenses we will quickly cover at our next WREIA meeting on Oct. 16th. Being aware of them will help put more money in your pocket at closing.

And on Oct. 16th, we will cover so much more…..

If you want to learn how to make money flipping houses in the DC area – in 2017, ’18 and beyond – join us at WREIA on Oct. 16th.

I’ll give you a roadmap with action items you can take and put to use as soon as you leave the room.

If you are ready to get to work – Join me on Oct. 16th.

WREIA 2017 Oct. Meeting
Monday, October 16th
Doors Open @ 6:30PM
“How To Flip A House In Any Market”

Reserve your seat by clicking here.

John Peterson
Founder, Washington REIA Network

Re: Donald Trump and Russell Simmons

Russell Simmons wrote the book “Do You! 12 Laws to Access the Power In You to Achieve Happiness and Success.”

In the foreword to the book Donald Trump writes this:

“But while I could talk about Russell’s entrepreneurial acumen all day, this book is about so much more than just making money. That’s because Russell understands that the true definition of success can never be measured in dollars and cents. This concept might not seem to be something I would normally promote, but I couldn’t agree with it more. In fact, I’ve always said that while success is good, success with significance is even better. And I think that you’ll find that the kind of success that Russell is promoting in this book is very, very significant indeed. “

Donald immediately goes on to say this:

“That’s because it’s a success that’s based on sharing instead of hoarding. On staying open to new ideas, even ones that might seem strange at first. On making the right choices, even when they don’t seem to be in your best interests. It’s the kind of success that we should all strive for.”

Now turn to the first chapter of Russell’s book and what does he start with?

Vision.

In my last post for you (the one about Dr. Phil) I talked about taking action.

I appreciate people who take action. There comes a time in business when it’s simply time to stop talking and start walking.

But here’s the thing. Some people start walking, and they don’t know where they are going!

That’s horribly dangerous. You waste our most treasured resource when you start off without the destination in mind. TIME.

But it doesn’t stop with you. You waste the time of people around you when you don’t know – with certainty – where you are going.

I don’t want you to do that to yourself or anyone you plan on working with.

Russell Simmons is a legend in the hip-hop community as well as the business community. He started his company Phat Pharm and sold it for $120 million.

Back to Vision –  without even leaving the first chapter of his book, you will find Russell saying this about hip-hop:

“Hip-hop is all about believing in your vision. In its original form, hip-hop was about one person grabbing a microphone and telling the world how great he or she was. It was about a poor kid who probably didn’t have much creating an all-powerful vision of himself in his mind and then sharing it with his friends, his block, his borough, his city, and then ultimately the world.”

In our business, we need to have a vision as well.

We need to figure out how we are going to help people and make a profit at the same time.

Are you going to focus on people who have lost control of their house and that house now needs major repairs?

Or are you going to focus on people who have lost control of their situations, and might be going through a hard time on a personal level, like a divorce, job loss, or loss of a family member?

I’m simply going to suggest here that if you focus on the houses you will find profits and success. But if you focus on the people you will find success with significance – the kind Donald Trump and Russell Simmons talk about.

At our next WREIA meeting I will show you steps to take that will let you flip a house in any market.

You should join us.

If you want to learn how to make money flipping houses in the DC area – in 2017, ’18 and beyond – join us at WREIA on Oct. 16th.

I’ll give you a roadmap with action items you can take and put to use as soon as you leave the room.

If you are ready to get to work – Join me on Oct. 16th.

Reserve your seat by clicking here.

John Peterson

What can Dr. Phil teach us about real estate?

Re: How To Flip A House In Any Market

I’ve met with a few “new” people recently who tell me they “want” to start investing in real estate.

The sad thing is this is so common these days. SO many people want to get started, but just never take any real concrete action.

Let me tell you – watching a few HGTV shows and following it up with a couple free Youtube videos is not going to turn you into an active real estate investor, let alone make you financially independent by next Friday.

The reality is that so many people are having trouble because they don’t know the next steps to take to 1. find a house and 2. get it under contract at a price that will allow them to make a profit.

You don’t need a real estate license or a MBA from Harvard to do this stuff. It’s not rocket science or brain surgery.

In fact, it’s simple – but it does require work.

Dr. Phil has a quote that is just spot on:

“The world couldn’t care less about thoughts without actions.”

No one cares if you “want” to be a real estate investor.

Nobody cares if you are getting ready to retire next year and don’t have 10k in savings.

No one is going out of their way to help the person that simply wants to sit at home in front of a computer, mouth wide open, waiting for inspiration to suddenly fills their bank account with profits.

What I DO care about is the person that WANTS TO and then follows it up by TAKING ACTION.

Specifically – there are steps that show me if someone is serious about this business. They provide EVIDENCE if someone is serious or just a wanter. I’m going to lay those steps out for you at our next meeting.

You should join us.

If you want to learn how to make money flipping houses in the DC area – in 2017, ’18 and beyond – join us at WREIA on Oct. 16th.

I’ll give you a roadmap with action items you can take and put to use as soon as you leave the room.

If you are ready to get to work – Join me on Oct. 16th.

Reserve your seat here.

John

Re: September WREIA Meeting TONIGHT!

Hello Everyone – One final quick detail about our WREIA meeting tonight.

We are going to do something we’ve never done before at WREIA. Build a marketing campaign – Live – using audience feedback.

If you would like to see the research and sourcing of ingredients that go into a marketing campaign – that brings results – you should be with us tonight.

Let’s catch up after what seemed like a longer than usual summer break.

Looking forward to seeing everyone in a few hours.

John

P.S. If you need to – you can still reserve a seat at this link. Your online reservation saves you a few dollars and helps us avoid last minute scrambles to find extra seats.

Re: The Numbers

What’s the common thread that runs through the TV shows “Shark Tank” and “The Profit?”

Numbers.

Successful people pay attention to the numbers.

It’s how we keep score in business. (Per Kevin O’Leary)

Marcus Lemonis, the star of “The Profit” will tell you “”Control your cash, stick to your core business, and know your numbers.”

Or how about this exchange on Shark Tank in 2009 –

Sometimes I laugh at these shows. How could they not know that the poor guy was barely getting started, or that he was generating so little business?

The reality for us is – in our business – $4500 can be made in a day. A commission on a sale, or a wholesale deal is all it takes to generate 5, 10 even 20k.

Especially here in the DC area.

Which brings me to this slide you will see in the slide deck tomorrow night:

When you know your numbers you know that getting one person to fill out a form, or simply land on a page has benefit to your bottom line.

If the case above – if you can close 1 out of 9 people – what is the value of that customer to you?

Will you make 5k from a commission or 30k renovating and flipping a house?

You’ll notice this is a snapshot from this week? When I had a conversation about this particular slide last night – it kept me up.

Yup. Couldn’t sleep much last night.

That’s the good thing about getting your creative juices going. It tends to lead to progress in your business.

I hope you join us tomorrow night. Especially if you like to combine both the numbers and the creative side of our business.

You’ve been warned though – especially if you’re the creative type – some of the slides might keep you up.

You can grab a seat for next Monday night or become a WREIA member here.

*********

Interested in a single night seat or a WREIA Membership?

Save a few dollars and reserve your seat early.

Tremendous Savings and Additional
“Members Only” Perks for WREIA Members

*********

FOCUS and make 2017 a great year for your business!

Let me know how I can help you,

John Peterson
301-881-5541
Washington REIA Network, President
Profitable Property, Founder

P.S. Interested in a lender or construction partner for your project? We lend to and partner with people all over the DC area. Call the office and lets set up a time to talk through or walk through your project.

Re: Three Things You Should Know About Irma

#1 Irma Is B.I.G. “Big Irms” is one of the largest and strongest hurricanes to hit the U.S. in decades. She is causing fatalities and property destruction all along her path. Stop for a moment and say a prayer for safety for everyone in her path.

#2 For such a big hurricane she has a lot of endurance. Hurricane Irma is expected to register Category 4 or more for five consecutive days – only the fourth time this has happened since 1966.

#3 “Big Irms” is forecast to turn to the heartland of the country and she is not stopping our WREIA meeting on Monday evening. We are good to go and look forward to having you.

Summer is over and it’s time to start the final push to wrap up the year.

Monday night there will be a discussion on best ways to ENGAGE your audience.

• Get your prospects to call, email, text or respond to your social media posts.
• Learn the minimum response and engagement rates you should be looking for on social media.
• Engagement doesn’t have to be a HARD SELL. Learn how to deep dive on the personality of your prospects. (For FREE!)

Come out on Monday, Sept 11th and hear what is working (and not working) across the DC area. 

Bring your questions for the Q&A section and…..

No products to purchase!  This is content rich material you can execute on immediately!

Grab a seat for this Monday night or become a WREIA member at this link.

See you Monday!

Re: FRIENDS

In our last post, we talked a little about headlines when you are trying to sell a home.

In the entertainment industry, the “headline” for any production is the title of the show.

Could you imagine if the hit show Friends was called Insomnia Cafe? That was, in fact, the original name – which was quickly followed by Six of One, then Friends Like Us.

Ugh… horrible names!  But….

By Sept. 22nd, 1994, NBC rolled out the show “Friends” to nearly 22 million people.

It was an instant hit.

I will explain how this all rolls back into our world of real estate in a second.

But first – let’s look at the original description of the show when the creators were pitching it to networks.

“It’s about sex, love, relationships, careers, a time in your life when everything’s possible. And it’s about friendship because when you’re single and in the city, your friends are your family.”

Does that zero in on a target market?

Sure does. It spoke to millions of single people and those of us who remember being single in our 20’s and 30’s. It also spoke to a new generation of kids who were just coming out of college wondering what it was like to get that first job and struggle through first jobs, first dates and so on.

Now – how does all this relate to us and our day to day work?

#1 – Get started.

Choose a name. Choose a neighborhood. Choose a paint color. Do something to get started. This hit show went through a number of missteps and edits before it finally took off and was released to the public. The producers had so much feedback they knew it was going to be a hit.

#2 – When you are down, you’re not out.

If and when you do fail, you’re not out of the game.  You still have contacts, and more importantly accumulated knowledge. 

The creators of Friends had just had their previous show canceled. Here is an excerpt from an interview with the cast and creators –

Kevin Bright, Marta Kauffman and David Crane created “Friends” at a low-point in their careers. A sitcom of theirs, “Family Album,” had just been cancelled by CBS. The future seemed very uncertain.

Even in the face of massive failure, this group went on to produce one of the top TV shows of all time.

Don’t give up. Keep going.

#3 Pay close attention to your headline.

How you present your home to the public is terribly important. When you write your description of your property – appeal to what people WANT in their lives.

Most people want some solitude in the suburbs or some excitement in the city center. GIVE THEM THAT!

Don’t sell a condo. Sell a location near restaurants and theaters packed with amenities.

Don’t sell a single family home. Sell a quiet hide-a-way on a secluded secret street no one knows about hidden just off a major roadway.

Think about improving your properties so that when it comes time to write your headlines and sell your property – it’s nearly effortless.

When you know your target market – that’s exactly what this entire process is like – effortless.

And a bonus lesson here –  just like the show Friends – when you target a market, people from outside your target markets may show up and support you. Who knows – maybe that exciting downtown condo you thought would be purchased by a fresh college grad will be purchased by a newly single widower wanting to be near some “action” again. (Yes, that happened to me.)

Lastly – A few of our long time WREIA members replied about the ad man David Ogilvy mentioned in our last post. His books were instrumental in my early career as they have been for many small business people.

His passion about headlines is evidenced by his quote –

“On the average, five times as many people read the headline as read the body copy. When you have written your headline, you have spent eighty cents out of your dollar.”

In fact, if you want some evidence of his genius, I just found this link a few days ago. It’s packed with a few of Ogilvy’s famous and favorite ads.

For instance:

There is an interesting story behind his Hathaway Shirt ad.  You will learn some of the back story to this ad Monday night. It’s especially exciting as a small business owner.

Moving on…. now that you understand the importance of headlines, and have seen a few professional and timeless examples – WHERE DO YOU POST YOUR ADS?

Facebook? Maybe.

Google ads? Maybe.

We mentioned great photos – must be Instagram right? Perhaps.

Pinterest?

Snapchat?

Fox News or CNN? Huge audiences, certainly an option.

Twitter?

A lot of the answers to these sites are VERY dependent on your budget and the time you can devote to engagement with your target audience.

Customer Engagement is a major topic for our WREIA meeting on Monday night. You have to start a conversation with a customer in order to ultimately get some business done. (That’s why we spent so much time on this headline topic.)

Let’s face it. We live in a digital age. If you can’t get the first click, you probably won’t get the final sale.

Join us on Monday, September 11th. We will be hyper focused talking about marketing tactics and specific advertising for small businesses that brings results.

Getting your message in front of the right audience has never been more important.

You can grab a seat for next Monday night or become a WREIA member here.

*********

Interested in a single night seat or a WREIA Membership?

Save a few dollars and reserve your seat early.

Tremendous Savings and Additional
“Members Only” Perks for WREIA Members

*********

FOCUS and make 2017 a great year for your business!

Let me know how I can help you,

John Peterson
301-881-5541
Washington REIA Network, President
Profitable Property, Founder

Re: Advertising – Part 1

In our last post we talked about an article that detailed the shared common traits that result in 10k views on a Zillow listing.

What it all boils down to today is that you must have nearly amazing photos and spectacular words to get any type of attention.

If you don’t choose the right photos and words – your listing could simply flop.

No traffic online.

This means no traffic to your house in the real world.

Which means no traffic in your wallet.

Even in an aggressive buyers market – the more people that you can get excited about your listing – the more likely you are to get top dollar.

Better yet – get enough people excited and you might find yourself in a bidding war.

There are many “ingredients” that go into a profitable property flip:

• Choosing a great neighborhood with good nearby schools
• Choosing the right home where the bulk of buyers will be interested in “living”
• Choosing the right materials when you improve the home
• Not over-improving the property while still being competitive in your upgrades
• Not over-paying for the property to begin with
• Doing it all in a timely manner so you can get to the closing table and collect your profit.
• and many, many more.

All along the way – if you make the right decisions – the process can be really very simple.

When it’s time to write up the listing for sale – it’s nearly effortless.

However, if you choose the wrong house that is just a little too small you can find yourself overpriced, and waiting for the right buyer.

On a recent “real life” home buying show one of the buyers said something that made me laugh out loud.

“I don’t want to see any house that they say is “charming”. Charming just means it’s small.” – Home Buyer on TV Show

The buyers are onto all our old tricks. If the house is small – let’s just play it up for the audience that is out there looking for something small.

For instance, your headline could be

Save on electric bills this winter!
Smaller house = smaller utility bills!

What that does is “targets” your audience. People looking for a monstrous McMansion will pass right on by. On the other hand, it will cause the right person looking for something smaller to stop and stare.

Speak directly to YOUR AUDIENCE. Ignore the rest.

Now on to David Ogilvy. He wrote a book that came out in 1983. The title was Ogilvy on Advertising.

It’s considered timeless by anyone in the advertising industry. If you’ve never heard of it and are seriously running a business you deserve to give it a good slow read – with a highlighter.

Ogilvy spent his career working on ads for major corporations. He would get laser focused on an audience, understand what they wanted and then speak to them in his ads.

Something I really appreciate about the guy – as an ad man –  He wasn’t afraid to ask for the order.

If fact, he seems to sum up his efforts with this quote from his book –

“When I write an advertisement, I don’t want you to tell me that you find it ‘creative.’ I want you to find it so interesting that you buy the product.”

Keep that in mind when you are working on your next property. Whether you are rehabbing the bathroom or writing the listing – are you looking for a pat on the back for being “creative” or are you trying to sell the property?

With that thought, and before we eat up too much time, how about I leave a little more to this discussion for part two?

Now, I hope this does not surprise you. I’m about to ask you for an order.

Come on out on Monday, September 11th. We will be hyper focused talking about marketing tactics and specific advertising for small businesses in our DC area that brings results.

Getting your message in front of the right audience has never been more important.

Learn what it’s like to run monthly 4 and 5 figure marketing campaigns for companies in the DC area and beyond.

You may not have the budget or interest in spending 70-80k in a month on marketing.

That’s completely fine. You can relax.

You can still learn to easily use these tactics and scale them down – or up – depending on your individual needs.

Maybe 70-80$ in ads is all you need to improve results on your listing? Don’t let 70-80$ stand in the way of actually selling a home!

When done right – this type of targeted marketing will pay off with thousands in profit.

You can grab a seat for next Monday night or become a WREIA member here.

*********

Interested in a single night seat or a WREIA Membership?

Save a few dollars and reserve your seat early.

Tremendous Savings and Additional
“Members Only” Perks for WREIA Members

*********

FOCUS and make 2017 a great year for your business!

Let me know how I can help you,

John Peterson
301-881-5541
Washington REIA Network, President
Profitable Property, Founder

Re: 10k views on Zillow

On Monday, September 11th we are going to talk about marketing your real estate business.

Most people think about marketing in our business as “looking for homes”.

But let’s talk about the time when you try to sell the property.

Let’s start here and agree that it’s important it is to get your property in front of as many people as possible – who qualify for your home.

Here is a quick link to a Zillow article. In the article, you will read how important the photos and a good description are for your views. They follow it up with a great sample of a well-written property description.

Which is all well and good. Great article.

But…..

What they are leaving out in this story is the fact that in order to sell the property you have to market to a hungry audience and target the people who are qualified to purchase the home.

The good news is – it’s easier than ever to target your market. And you don’t have to worry about getting 10,000 views on Zillow in order to sell a property today.

You only need one view from one person to make a sale. As long as you trigger their emotions in certain ways – they won’t be able to forget your property. (In fact, they will have to see it.)

That’s just a hint of what you have in store for our next WREIA event on Sept. 11th. You are going to learn some great “stuff” about marketing at our September meeting.

Our guest in September is an outside speaker.

Well, sort of.

Many of you know him and have met with him after some of our previous WREIA meetings. We often talk about the various forms of marketing he helps me with throughout the year.

Come on out on Monday, September 11th. He will be hyper focused talking about marketing small businesses in our area that brings results.

Getting your message in front of the right audience has never been more important.

Learn what it’s like to run monthly 4 and 5 figure marketing campaigns for companies in the DC area and beyond.

You may have no interest in spending 70-80k in a month on marketing.

That’s completely fine. You can relax.

You will learn to easily use these tactics and scale them down – or up – depending on your individual needs.

You can grab a seat for next Monday night or become a WREIA member here.

*********

Interested in a single night seat or a WREIA Membership?

Save a few dollars and reserve your seat early.

Tremendous Savings and Additional
“Members Only” Perks for WREIA Members

*********

FOCUS and make 2017 a great year for your business!

Let me know how I can help you,

John Peterson
301-881-5541
Washington REIA Network, President
Profitable Property, Founder