What can we learn from Flipping property LA style? - searchpartyproperty

What can we learn from Flipping property LA style?

Flipping Houses - Property Investing

This is Luke Moroney for the daily property search podcast. And the topic I’d like to talk about today is, what can we learn from flipping property, LA style. Before I get into this topic, just a disclaimer that this podcast is for general purposes only and should not be regarded as legal or financial advice. Make sure you get your own independent advice when it comes to investing.

Looking at other property markets

So I was out and about with Adam, who is a local resident of Los Angeles, and he’s actually born in Australia. So we connected over social media, and when I’ve been in LA, I’ll spend a bit of time with Adam seeing some of the property deals that he’s doing, getting some experience and knowledge behind the Los Angeles market, how to transact properties the way he does, and look at various options that are available and get a bit of an insight about the conversations that he’s having, and discussions and deals that he’s creating for himself and for the people that he’s purchasing these properties from… so it’s important to really get a sense about how other markets are working, what you can bring back to the market you’re working within, and how you as an investor can really grow in knowledge, skill and experience and learn other people.

Learning from other property investors

There’s always, you know, a question that being asked by someone that you learn from, or a thought process that they go through, or one little nuance or two, especially, even if you are an experienced investor, there’s always things that you are learning, and that’s why it’s important for me, while I’m away overseas, to think about what are the options? What are the ideas, what other learnings that I can create for myself? 

Global influences on Australian Property Market

I think it’s an important part of investing to think about what actually goes on with the rest of the world. How are things going to maybe change and adapt in Australia for what we need to do in future? How can we be a little bit more creative to get that better deal and work with things a little bit better now? The Airbnb movement came through from, you know, a US sort of setup into Australia, people took advantage of that fairly early and got on board with that ID. Now it does require another level of skill and experience, and a really good team around you, as does every property strategy and that the team is important. And I think what I like about working and working with Adam and actually seeing how he’s transacting properties and some thoughts around what he’s doing, it’s really going to help me in future about some of the property deals that I’m doing for myself, or we’re working with clients with as well and might just just bring out another few little options or few variants, variances of what we do at search party property with myself and Julian on the team. 

So I thought I’d bring you a bit of insight on, you know, doing the property tour with him around Los Angeles in the last couple of days, and some of the discussions that we have. 

Make direct contact with sellers

The first point I’d like to make is the idea of going to a property deal. Or what he does is actually make contact with sellers direct. So that might be either by having fliers in the mailbox or knocking on doors and making some really good connections. And often what he sees if there’s signs on the doors or those little things that indicate there might be a distress seller, that he goes in to the that discussion about thinking about solving solving their problem. And I think that’s an important way that we, you know, need to think about and tackle these issues. It’s not about trying to really get the, you know, push the penny and get a ridiculous price on the property and then the owner of them becomes homeless, it’s about doing something that little bit different that’s actually going to create a great situation for everybody involved. So they might be in a situation often where they’re in debt with the banks, and they You know, in several thousand dollars of debt and they haven’t paid their mortgage over the last 3, 6, 12 months, and the banks are coming knocking on their doors by putting notices up and pushing them to make a move. And I guess, in knowing this as someone who deals with property, and how Adam approaches It is about trying to see ways that they can have the problem solved. And that person actually doesn’t become in a position where they have a bad credit rating and they can actually move out and be able to rent when they don’t have that credit rating, bad credit running over their head. So it’s important that people that are in distress that they do seek out the options now there are going to be people that are trying to scam them or trying to, you know, get the best deal of all time and they lose out of the deal. But there are people like Adam that are out there to try and see a situation resolve a problem that’s currently there. You’re not going to be able to fix everyone’s problem. But if you can see that opportunity that you can make some profit as well as they can get out of a situation where the banks are calling, and they actually get more money than what the bank will offer him. That is, you know, highly possible. 

Win-Win for seller & buyer

So we’re at a property today where I did a Facebook Live with Adam about talking on a story about an elderly lady that, you know, was behind on a ranch, he actually had a hip replacement, and then what they end up doing the banks were only going to give a $5,000 they ended up giving her significantly more and started to help her pay, pay down the mortgage on that property. And it was a situation then it was a case that over time they organized for her to move to another location. The rent was already organized, the mortgage was being covered and the renovation was done on the home. And now they’re in a situation where the property is now being on sold to someone else. So it’s been a really good situation where the the owner of the property has moved on into a more secure and less stressful environment and not having the debt hanging over them. And they’ve actually in a better cash situation than what the bank’s presented with them. And they’re also in a situation where Adam and his team have won in terms of making a profit on that particular property transaction as well.

Solving problems

So if people do get in distress, and stick their head in the sand and don’t see where the possibilities are, and they don’t know what the options are, someone like an Adam can really help people to move forward with their issues and solve these problems. So that’s what it is all about thinking about solving problems. You know, whether you’re in in property investing, whether you’re in a business, or you know, in other areas of life, some of the biggest companies and best companies around the world, are in business and are very successful because they’ve solved a problem. So that’s an important one.

Working with a team

The second point I’d like to make, which I sort of highlighted on a little bit there was, it’s about working with the team. So Adam, work with people that knocked on the door and my regular contact with this particular person that was in distress. And, you know, kept educating them along the way about the possibilities and options that they could come out with about that particular sale. And you know, all through that there’s other people in financial areas of that transaction that were within their team, and then other areas that have including trades people to do the renovations and other works. so significant that you do, rely on your team or work with a team that is really going to be helpful in the situation of getting the best deal for everyone. So yes, the Scylla makes profit and the money out of the deal and gets out without having poor credit ratings and things and other issues moving forward for them and also you as a as the deal maker. On this transaction, or Adam in this situation has a team of people to make sure that they’re making the most profit out of it. Now there was a situation in this particular deal that the renovation was taking a little bit too long. So it might be that is, moving forward to not use that same tradesperson in future and sometimes you, you might incur these sort of problems, but in the end, yes, it would have been a lot better if they were able to finish those renovations quicker and would have made a little bit more profit, but you learn from your experiences as well, you’re not going to have a perfect every single time. So that’s an important one to remember to work with the chain. 

Making a profit

The third point I’d like to make is about making the profits, you want to obviously get rewarded for the time and efforts that you are putting in, and Adam in this case was and it was a good windfall for him and his team, and they were able to have these all turned around and completed in a timely fashion and Have a situation where the problem was solved, they work with a good good team and they end up making the profit out of the deal. So then they can go on and work with other deals and work with other people to then increase their wealth and solve more problems that are out there. And it’s an ongoing story, whether it be in Australia, whether it be in the US or other areas around the world. This is happening day in day out, and people don’t know how to tackle these situations. So there’s property people out there that know how to deal with when situations arise. And there’s various different levels of notices and activity that happens from banks or other areas of buy when people get into bad debt. 

Having a strategy

And we got as a as a, you know, property professional, you’ve got to look at each situation and judge it, how it’s gonna work best for the all the parties involved. So you’ve got to, you know, seeing some of those things in flipping properties. Doing It property strategies in the US has really made me think about what can we have it happen in future for us in terms of property buyers agent, our search party property, how can we do maybe deals a little bit more creative where it does help people win a little bit more in future. So some things to think about that may allow you to think a little bit differently. Think about problem solving, think about working in teams, and think about what profits that you’re going to create in the end. And I think with all that in mind, you can be a better property investor, and hopefully that has given valuing for you to realise that people are doing it really well. And you can learn a lot of them and I continue to learn for myself. So if you want to speak about this particular topic further or your own property, circumstances, please do give me a call and thank you so much for tuning in.