Home Buyers has been in the home-buying business throughout Southern California for the last 15 years with purchases over 100 homes per year. In a time and place where the ever-increasing threat of losing money in real-estate is prevalent, Home Buyers has remained fortunate in their ability to evaluate properties correctly, purchase at the right price and resell for a profit.
Here are some of the more important issues Home Buyers looks at when investing in the Southern California marketplace:
1. Cash availability to fund the deals found.
2. Cash availability based off of LTV, not credit.
3. Determining whether the deal is good or not.
4. Exploring the multiple facets of how to attract deals.
5. Understanding which investment strategies to pursue: flipping, rehabbing,
options, lease-options, owner financing, sell as rental turnkey.
Out of all of these, the most important aspect is being able to determine whether the deal is good.
How do we know if a deal is a deal?
While capital is a crucial key, being able to ascertain whether a deal is good or not is the key to keeping our capital investors happy, bringing more funds forward and solidifying the returns our capital investors are used to seeing, which typically ranges from 10-15%.
Being able to determine whether we can turn a profit on a particular deal AHEAD OF TIME is a critical part of the decision making process. Not only are we proud in our home buying capabilities, we are proud that we realize the profits that we do and secure our capital investors ROI as promised.
Therefore, when we create a fail-proof system for evaluating and purchasing houses, the likelihood of Home Buyers success rate remains higher than most other home-buyers in the marketplace.
So, how do you know if it's a good deal?
Since we buy REOs (real-estate owned or bank owned properties), directly from builder's (called "builder closeouts") as well as from individual sellers, we have to utilize different investment strategies to profit from them.
We like to break them down into our two most common "Buy/Sell Profit Models":
1. Buy for cash / Sell for cash (either wholesale/retail or wholesale/
wholesale)
2. Buy for cash / sell with lease option (either short long term seller
financing)
After breaking it down to this level, the way I make a buying decision is pretty simple:
1. A property becomes available for review.
2. We run it through two different spreadsheets for each of the Buy/Sell
models above.
3. If we can't see my way through to making a profit with at least one of
them - we pass.
Otherwise, it's a potential BUY, and I'll spend a bit more time to confirm the data that came with the lead to make sure my numbers are accurate.
Then and only then it's time to see the Seller, view the property, complete the negotiations and get the deal signed up.
We evaluate properties ahead of time through spreadsheets to protect our cash-backed investor's funds as well as to secure the highest return on investment for all parties involved.
In our experience an average investor is too anxious to make a deal, especially if the leads aren't coming in often enough to allow them to "cherry-pick" the deals they want. Home Buyers receives so many properties from our advertising, referral-systems, direct relations with banks and builders looking to liquidate that we have an over-abundance of leads.
Here is where most other investors fall short in realizing profits from every real estate purchase bought:
- They don't account for all anticipated expense items.
- They only look at best case scenarios and don't review negatives, what-ifs, gotchas, etc.
- They plan for overly optimistic sales time or sales prices and don't plan
for longer sales period and/or lower price points.
- They don't plan for not being able to sell (for cash) and having to roll
over to a different profit model (lease/option or owner financing).
- They don't plan for tenant/buyers not exercising their options (or owner
financed buyers not refinancing their loans and paying us off), moving out and leaving us with the expenses of cleaning the place up, incurring
higher than planned vacancies, extra advertising expenses
- They don't plan on being subjected to unfavorable market fluctuations for
Buy/Sell models that stretch over a period of time.
So, when Home Buyers goes through the motions and runs numbers through spreadsheets, this ENFORCES the discipline of (a) full accounting of all applicable expenses, and (b) playing ALL possible scenarios, good and bad... but playing them in advance, before committing to purchasing a property.
Trust us, it's a lot better to play bad case scenarios and account for all expenses BEFORE we buy the property than AFTER.
With over a decade of buying houses, Home Buyers is geared towards even greater successes in a marketplace that has the best buying opportunities ever. Should you be looking for a safe, secure and higher than average return on your money, there is no better real-estate buying power as that which backs Home Buyers abilities in the Southern California marketplace.