Hello readers, Once again I’ve been invited to write an article for another site In this post I discuss some important tips on re-habbing a house.
Check it out here!
Top 5 Tips on Re-habbing houses
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When I first got involved in the Orlando real estate business in 2003, I was on a shoestring budget and hungry to make some money in this business they called real estate. At one of the first real estate boot camps that I attended, there was a guy named Dan Doran aka “Dan Doran the marketing man” and he was selling a course that was supposed to teach you about knocking on doors of people that are in the process of foreclosure. When I think about it, it was a scary thing to do. However, we just had our first son and we were determined to “make it” in the Orlando real estate business no matter what. So I went through Dan’s course a couple of times, made some cheat sheets that I could carry with me, and hit the ground running.
You see, when we first started this business, we didn’t have the budget to do massive postcard campaigns or any other kind of marketing for that matter. That was the beauty of door knocking… all you needed was an up-to-date foreclosure list and a tank full of gas. In those days I was a private investor and not a realtor which sometimes had its advantages.
Anyway, I started knocking on doors in a town called Pine Hills which happens to be a pretty rough part of town. I got all kinds of responses such as the door being slammed in my face, getting yelled at, and even getting a few death threats. Responses like; “Who are you and what do you want?” or “We don’t want any, Go away!” were common responses and I was told that these responses would build my character. LOL! However, about one out of every 15 doors that I knocked on offering to help the homeowner, I would get the deal! Wow, what a great feeling that was! Then I would be soo happy that I seemed to forget about the 14 other people that I visited that told me to get lost.
These days, the thought of knocking on doors to get leads makes me cringe… Sometimes I find it hard to believe that I ever did it in the first place.
Orlando realtors are finally getting the “Big Picture”
Most Orlando real estate agents these days like myself, are trying to focus more on their online presence above all else. The price of postage is expensive and most days people start their search with Google for everything anyway. Orlando realtors that don’t do any online marketing are really missing the boat when it comes to advertising in 2013. Our site at https://orlandorealtyconsultants.com/ brings in about 90% of our listings with the rest being from referrals. We haven’t sent out a postcard or letter in over 2 years.
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When you’re re-habbing a property, hiring a general contractor aka [GC] can be extremely valuable to you in reaching your real estate goals. There are a million things that need to be considered when you are planning major renovations. A GC is someone that holds the main responsibility for the construction, improvement, or renovation project and is also the person who hires all of the subcontractors and suppliers for a project such as plumbers, carpenters, electricians, etc. The GC with overall responsibility for the satisfactory completion of a project and is expected to perform as well as supervise at least part of the work.
About 6 months ago we bought an Orlando short sale house with the intentions of doing a major re-hab on it and turning a really nice profit on the deal. The house needed kitchen remodel and so did the three bathrooms, other than that it just needed paint and carpet and a little siding…no big deal. I’ve done many rehabs over the years and up until now I always played the role of GC. However, this time I needed help because I knew that I would be traveling for the next few months and I wouldn’t be available to supervise the project.
After we closed I started researching GC’s in the Orlando area. Some were licensed and some were not… I ended up with 3 GC’s that I met at the property for estimates. I noticed quickly that unlicensed GC was way way cheaper than the Licensed guys. I learned long ago that hiring the cheapest guy just because he’ the cheapest will always, always end up costing you more money and aggravation in the long run. At the same time I never go with the over-the-top most expensive guy either…and I pretty much do that for any service that I need to hire,.. I get 3 estimates and usually pick the one in the middle. It’s a method that has served me well over the years.
At this point I had I had decided on which GC to hire and I was ready to pull the trigger. I was on my way to drop off my kids at school and I ran into my friend Alex that I had known for 5 years now because our sons went to school together. All of a sudden, I remembered that Alex was a GC. So then Alex and I get to talking about my project and I figured “what the heck” I’ll let Alex give me an estimate as well. Anyway, I told Alex that if he could match the estimate from the other GC I had met with, then the job was his… I figured that I could help out a friend and get a good price on my project as well. So Alex tells me “no problem”… not only can he match the price, but he can have it done within 30 days. I thought…WOW! “I really picked the right guy for this job”….WRONG!
The project got off to a good start, the first few days he had at least 6 guys working at a time, then all of a sudden there was nobody. I was constantly popping up at the house checking on the progress and I didn’t see anyone there for at least 5 days straight. This worried me so I called Alex and he assured me that he would done on or before the deadline. I had to travel, so I had no choice but to believe and trust him. BIG MISTAKE… when I got back, I immediately went to see the house to find that they were no where near completion and they were already 30 days past the original due date. To make a long story short…The job came in at $10,000.00 over budget and to add insult to injury…It took 90 days to complete which translated into an additional $4,000.00 in carrying costs. Needless to say, I had some pretty harsh words with Alex and now we are no longer friends.
The moral of this story is… Never hire a friend to be your General Contractor. It will cost you more money and more importantly, it will probably cost you your friendship.
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Big real estate firms put big-time money into marketing which is why when people need a real estate agent most of them go right for the big names that they see on billboards and in TV commercials. There are some problems, however, with using the larger firms that have been brought to my attention enough times to finally write about it.
When brokerages put a ton of money into marketing then they end up getting a massive amount of leads from it. The problem with that is that some brokerages are just not equipped to handle all those new buyers and sellers they just spent a ton of money marketing to. When this happens real estate agents tend to put most of their effort into the deals that are going to make them the most money,… that’s just human nature. Unfortunately, for buyers with lower incomes and sellers with cheaper houses, this can potentially turn into a very bad experience for them.
Real estate agents get paid on commission which means the lower the purchase or sale price, the lower their commission will be. So when the leads get assigned or referred to the agents in the office the buyers with the most money to spend or the seller with the most expensive house to sell will get most of the attention. The rest of the potential buyers or sellers end up getting put to the bottom of the stack. The “when I get around to it” file.
Buying your first home is one of the most important decisions of your life and should be a very happy and exciting experience. The problem is that many people lack the knowledge needed to find the right real estate agent for them.
Is it time to fire your Realtor? Here are some tips that will help you find the best real estate agent for you
1- Google them! – A good agent will have a strong online presence and you should be able to pull up a world of information on them. Take some extra time and read reviews that people have written about them. If they have negative reviews or none at all, then it’s time to move on to your next candidate. From your online search, you should be able to come up with at least 3 good candidates.
2- Set up an in-person interview. – Once you’ve chosen you three candidates now it’s time to meet them in person. They should ask you questions like “are you pre-approved for a loan and how much?” What kind of house are you looking for? How much do you want to spend? What neighborhood?, etc.
Then pay close attention to what the agent shows you. Is it what you’re looking for? Was the agent paying attention to what you said? If the agent starts showing you properties that are far from what you asked to see then…..”NEXT”
3- What’s their track record? – Don’t be afraid to ask questions like.
*How many houses have they sold?
*How many have they sold in the last 6 months
*What do they specialize in? Are they a short-sale specialist? A buyer’s agent?, etc. It’s important that your agent specializes in whatever it is that you’re trying to accomplish. You wouldn’t go see a foot Doctor for a toothache, would you?
*Do they have any testimonials from past clients?
4- Make sure that real estate is their full-time job. A good real estate agent works full time as a real estate agent and there’s just no exception to this rule. If you’re working with a realtor that works part-time as anything else in order to make ends meet then it’s time to cut them loose.
5-Follow Your Instincts. You may have found the most successful real estate agent in town, but if you don’t feel comfortable around them or you just have that feeling in your gut telling you that they aren’t the one for you, then go with it. An agent/client relationship is kinda like a marriage…you’re in it for the long haul. On the bright side, it’s a lot easier to divorce your real estate agent.
So you see, it’s not at all about going for the biggest name with the biggest marketing budget. It’s about you putting in the time and doing the necessary research that it takes to find the right real estate agent for you. Good luck!
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Short Sale your home before defaulting on your mortgage…More and more we are starting to see a trend in the world of Orlando short sales and that is,… lenders are increasingly more willing to approve short sales before homeowners actually default on their mortgage and fall into a pre-foreclosure situation. This is a huge deal for homeowners that have been wanting get out of their upside down mortgage and haven’t done so for fear of severely damaging their credit.
According to our records we found that in 2012 about 20% of our short sale files, were deals where the lender had not yet filed for foreclosure against the homeowner. A few of them were deals where the homeowner wasn’t even behind on their mortgage. I for one am praying that this trend continues…for everyone’s sake. It just makes good sense,… if the homeowner is trying to be honest with the bank by letting them know that they will be defaulting before they actually default, why shouldn’t the bank use this information to move things along faster before they start losing money?? It’s a win win situation for everyone involved. The homeowner avoids damage to their credit and the lender avoids losing big money by getting a head start on the whole process of getting the house sold. They don’t have to worry about the mortgage falling behind for more than a few payments and even more importantly,… they don’t have to shell out thousands of dollars in attorney’s fees to start the foreclosure process.
Also, by allowing these “almost distressed” homes to change hands much faster will most likely put them in the hands of new homeowners who have loans they can actually afford, which means they are more likely to be able to afford and maintain the property and these people will be more motivated to be responsible homeowner.
Although some lenders are seeing the light when it comes to getting short sales done before waiting for the homeowner to default, the truth is that most lenders are just not having it. They have a strict set of guidelines that they follow to a ” T “, and there’s just no changing their minds…believe me I’ve tried. Dealing with these lenders can be frustrating, but it’s just part of being a short sale realtor.
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