According to RealtyTrac “Real estate investors made an average gross profit of $54,927 on single-family home flips in the third quarter, up 12% compared to an average gross return of $48,893 last year.”

Across the country, 32,993 single family homes were flipped in the third quarter of this year. That is impressive and certainly shows that investors are out in force across the country. But when you look a little closer – you realize that this house flipping business is starting to cool off.

The reason the average gross profit went up is because the number of homes flipped at the high end of the market took off, and 75% of the high end business was in just 5 metro areas – NYC and 4 CA markets.

For you number crunchers, the full article is posted here at www.housingwire.com/articles/27479-home-flippers-back-away-as-real-estate-turnover-activity-declines

Let’s not get discouraged. Not one bit. It’s great to set a goal post, and making over 50k flipping a house can be done right here in the DC area. And you certainly don’t have to flip a high end home to do it.

Despite the struggle and dysfunction we have seen over the last few weeks from our elected leaders, DC is still a highly desirable place to live. Our metro area is drawing people from all over the country, and to an extent from all over the world. It’s not sunny southern California, but DC offers something that California doesn’t have….

Power.

Monday night we are going to talking about what draws people to DC and how you can make a six figure income flipping homes in the DC area. Using the numbers above, an average investor can flip just two homes a year, and accomplish that 6 figure goal.

Do you think you could find, fix and sell two houses next year? I know you could! And there are a few things that you could do that would make the process a little easier and faster and reduce the risk of flipping properties in DC.

Let’s talk about those helpful items on Monday night. I hope I see you there.

“Flipping Houses in 2014 For A Six Figure Income”
Guest Speakers @ WREIA Oct. 21st – Register Here

Lastly, I hope you read the entire article we linked to above. In case you don’t get to it let me point out the last paragraph in the article. It may remind you of our rental program and our quest to purchase 100 homes – not to flip quickly, but to rent.

“As rent and home prices escalate and the number of available REOs continue to decline there are fewer people who are buying homes to flip. House flippers are kind of a misnomer as they’ve turned into what I like to call ‘holders’,” said Sheldon Detrick, CEO of Prudential Detrick/Alliance Realty. “Being a house flipper meant buy it, paint it, sell it. Now it’s turned into buy it, paint it, rent it, and hold it.”

Don’t get discouraged if your offers are rejected on a home you are trying to flip. You have a lead there, and you may be able to generate some cash from us using what one of our wholesalers called his “dead leads list”.

If you have a home that, because of the numbers, may not be a great home for you to flip but may make a great rental, let us know about it. Remember, you don’t have to make 50k all at once. The margins are lower all the way around on our rentals, but when we buy a few of your rental leads it will help you pay some bills.

Be creative and focus on 2014 being a great year for your business.

Join us at WREIA on Monday night, and let me know if there is anything I can do to help you.

John Peterson

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

P.S. The answer is YES, we are still doing partner deals with our students and WREIA members. You may need some help with financing or need a valuable construction partner with years of experience. Or do you need us to help speed up the process for you, and help drive your business to the next level. We are here to help. Just send us a few quick details at http://dchardmoneylender.com/quick-property-submit/ and we will get back to you ASAP.

Let’s imagine the average single family homes in your city rents for three to four thousand dollars a month.

So why would you pay $30 Million for 4 of your neighbors houses?

Because you have a $19 Billion dollar net worth, you have one of the highest profiles of any technology entrepreneur and you certainly do not want a publicity seeking developer to come in and buy your neighbors houses.

According to an article in the San Jose Mercury News, Mark Zuckerberg, Facebook CEO, has bought four of his neighbors homes and is now leasing them back to the previous owners.  From an investors point of view, his purchase was terrible.  But he didn’t by these homes for an investment – according to the article, he bought them in order to retain some level of privacy.

 You can read the article at http://www.mercurynews.com/business/ci_24285169/zuckerberg-buys-four-houses-near-his-palo-alto

You certainly don’t pay this type of a price when you are looking for a good ROI. But that is what makes our business so interesting. Remember, not every decision people make is because they are looking for a good ROI.

We as investors forget that when people are buying their own home, it can be very emotional. Mr. Zuckerberg has extended that to the homes nearby as well.

Each month in 2013 I have been reminded of why I enjoy this business. You can meet a wide variety of people and I am always surprised at the reasons people get excited when buying one of our homes. Sometimes it is because of a big back yard. Other times it can be the size of the home, or where it is located. I still enjoy selling a home to the first time home buyer who is thrilled to have a place that they can call “their own”.

If you are out there trying to find your next home to fix and flip, remember that you need something that your buyers will appreciate. Know your audience and who you will be selling the home to. Know the amenities that they want and will appreciate. Not all of us will be lucky and have a billionaire move in next door and pay too much for our home. All of us can put in some hard work, make repairs to a property, then market and sell a property for a profit.

Don’t plan on getting lucky. Make your plan to know your market, stick to your numbers, and do great work.

Let me know if there is anything I can do to help your business,

John Peterson
301-881-5541
Washington REIA Network, President

P.S. I hope I see you at WREIA on Oct. 21st, this coming Monday night. We will be talking about “Flipping Houses in 2014 For A Six Figure Income”

Get your tickets for the next WREIA Meeting on Oct. 21st.

Flipping Houses For A Six Figure Income – In the DC Area!

Click over to http://wreia-oct2013-wreia.eventbrite.com for more details.

If you attended our WREIA meeting on Thursday night, you know we had a great turnout and covered some terrific material.

Here are a few of the clips we missed due to the time constraints:

Selling Your House with the Help Of Hollywood

And as an example of one of those Hollywood Style Video Listings imported from Australia

And the last demo video shows how one company is using the Ipad for listings. This video is a year old, and already somewhat dated.

These are just a few of the examples we missed at WREIA on Monday night. Remember, set your goals on what you want to achieve in your business, and move forward using up to date and current materials to build your business.

Remember our article from a few weeks ago? McDonalds spends billions of dollars to update their stores. You should be investing in your business to give it a facelift every few years as well.

Let me know if there is anything I can do to help your business,

John Peterson
301-881-5541
Washington REIA Network, President

Profitable Property, Founder

This news reported by the Wall Street Journal could bring short-term benefits to the high-end market here in the DC Metro area.

As banks compete for affluent borrowers, an odd trend has emerged in the mortgage market: rates on loans for pricey homes — “jumbo” mortgages — have dropped below those for smaller mortgages. Nick Timiraos explains on the News Hub.

We posted a great link on our Facebook Page this morning.

The cost of experience when it comes to choosing an agent in our business – about $25k on average.

Remember – Local Agents, Investors, Brokers, Landlords and other Real Estate Veterans gather every month at Washington Real Estate Investors Association. Next Meeting is Monday, September 16th. Register Now!

Let me know if there is anything else I can help you with,

John Peterson
301-881-5541

Click For More….

We have seen a big jump in prices this year here in the DC area. This has been great if you have been lucky enough to sell your house.

The problem is – we are having a jump in interest rates now too.  That does not bode well for the mortgage industry.

In fact, in the last few days Wells Fargo has been busy cutting nearly 3,000 jobs in their mortgage divisions.

J.P. Morgan will be cutting 19,000 jobs over the next two years in states like California, Texas, New York, New Jersey, and Florida because their income from mortgage banking has dropped 14% from a year ago.

Bank of America had it the worst of the big banks.  Their mortgage income declined nearly 22%, so they now have a plan to fire 2,100 people and close 16 offices by the end of next month.

An article posted yesterday at the Wall Street Journal lists a myriad of troubles for the mortgage industry in the year ahead.  $1.65 Trillion in mortgages this year – which is down from 1.75 last year.  But pay attention to this – They expect next year to drop and bottom out at $1.46 Trillion.

You can find the article posted at http://online.wsj.com/article/SB10001424127887324094704579064863415657936.html

You will often hear me make fun of myself for being a C student.  But these numbers combined with rosy home price forecasts are not adding up.  Strong housing markets are driven by a healthy mortgage industry.

I am buckling up for a tough year. I plan on being cautious with where I buy houses, and even more cautious with when I buy.  I think we are in for a period of time when prices will not be rocketing up, but will not be dropping like a stone either.  Quite frankly, I think we are in for a period of time when prices just stagnate and stabilize…..

Like the housing market in the 90’s.

And that my friends, is just fine by me.  A stable market is good for everyone because no one has the upper hand.  Buyers can negotiate a decent deal, and sellers can sell if they want to.

You can plainly see with these two charts – a very obvious period in the 90’s when prices stabilized for nearly a decade.

The first chart shows prices across the entire US market.

Now, since “all real estate is local” lets look at our DC market (where it’s pretty obvious our prices got a little carried away) during the same period of time.

After the whipsaw prices of the last 6 or 7 years, a nice relaxing period of price stability would be great.

So that is what I am hoping Santa brings me for Christmas this year – The 90’s.

I hope I see you on Monday night at our September WREIA meeting.  It’s going to be a great night discussing Real Estate Marketing.  We plan on showing some successes we have had over the last few months and a few of our colossal failures from earlier in the spring.

Register now and join us on Monday night.

Let me know if there is anything I can do to help your business,

John Peterson

As we all age, there is little doubt that some of our neighbors will go in for a little “tune-up” and get some minor work done in the quest to improve their appearance.  And for these doctors, business is booming.14.6 Million cosmetic plastic surgery procedures were performed in 2012, an increase of 5% over 2011.   Most of our neighbors are going in for minimally invasive facial rejuvenation procedures like injections and abrasions, though the trend for major surgeries are pretty stable as well.What is needed in our personal lives is sometimes needed in the corporate world as well. McDonalds, for instance, is spending a little over a Billion dollars this year to give 1,600 stores a facelift.  That is on top of the 2,400 they “rebooted” last year.

And they did it for good reason:  “McDonald’s said that the new interiors can increase sales by 6% to 7% in the year after they’re completed.”

The McDonalds article is posted at http://www.fool.com/investing/general/2013/06/20/mcdonalds-1-billion-store-makeover.aspx

Now, McDonalds knows they have to invest in their image to stay current.  My question to you is – “When was the last time you updated your business image?”

A few minutes ago I saw the outline for the next WREIA meeting next Monday.  One of the sections is going to be about re-branding and updating your small business image.  Most of these tips are for those of us operating on a shoestring budget, who do not want to hire “image consultants” and high brow designers to give our business a facelift.  I was quite frankly very surprised at how little some of this image work costs today.

There is simply no excuse for not having a professional image these days.  We are in the early stages of working on a corporate facelift at our office right now, and re-deploying some of our old stagnant websites.  We are trying to lasso it all in, and keep a tight cohesive look and feel to each property and marketing piece – both online and offline.

Monday is packed with great information that could save you a fortune, especially if design is not one of your strengths.  I always recommend hiring the people that can do the job better than you, as soon as your business makes it possible.

You are going to be in for a treat on Monday night.  There is a ton of great current

information. You will be happy to hear, other than showing you two huge failures we had in the spring, we will not be reporting any marketing results more than 90 days old. This is fresh material.  In fact, much of our marketing work from 2011 and 2012 has been shelved, but the results are being used as a spring board for what we are doing in the near future.

We are not only looking back, but also at what’s ahead for real estate marketing. To be quite frank with you – as I review the outline for Monday night and look ahead to 2014 we see our  marketing plans changing –  again.

Remember – We are gathering some feedback for the WREIA meeting on the 16th.  We posted a quick 10 question survey, and  last week we asked for your help.

If you didn’t already, will you take about 3 minutes and check a few boxes for me?  The survey is posted at  http://www.surveymonkey.com/s/XV6WSGV

Just like last year, we will be sharing the results at the next WREIA meeting.

Thanks so much for helping.

One last time, you can find the survey posted at

John Peterson