Recent Purchase Case Study
Property Address: 1962 Leon Road, Jacksonville FL 32246
Purchase Price: $67,000
Renovation Cost: $38,500
Estimated After Repair Value (Sale Price): $135,000
The above case study are real numbers from a home that we closed on 2 days ago in Arlington. I chose this because these price points are common and there is a high demand for houses in Jacksonville at that ARV.
The median home price in Jacksonville, FL is $129,300. This means that if you are looking to sell your flip/rental property/personal residence, the $115,000 – $150,000 price point will have the most buyers. This translates to low days on market, less holding costs, and more profits. If you are looking to start flipping property or wholesaling in Jacksonville, ALL of your marketing should be focused on areas where nicely renovated houses are selling in that median price range. These are areas where there is the most opportunity and the golden price spread that allows you to give the homeowner a fair price for their house while still leaving a profit margin for yourself. This holds true to any city, research the median home value and hammer those neighborhoods with marketing.
The one problem that severely limits your ability to be successful in a real estate transaction is paying too much for property. If the seller in the case study above told me the least he would take was $75,000, the right thing to do would be to walk away. Trust your numbers and your gut, NOT your emotions. The two worst properties I have purchased thus far have both been emotional decisions on slow weeks. Trust yourself, endure the slow times and attack hard when actual deals are out there. Don’t try to manipulate the numbers on a deal into something that its not.
The key to this industry or to anything in life for that matter is consistency and discipline. If you are not out there pounding the pavement every day, answering the phone every time it rings, all you will find is frustration and disappointment. Great real estate deals are out there all the time but to generate consistent deal flow month after month requires putting in the hours necessary to do so. Don’t get overwhelmed and numb yourself to the fear of rejection. It is impossible to stop somebody who refuses to quit, every day that we have the opportunity to get out and hustle is a blessing. Show gratitude and enjoy the game.