MULTIPLE LANES - Mitch Stephen, author of the book My Life & 1,000 Houses

I prefer “BUY – DO NOT FIX – SELL, Owner Financed,” but when you move up into the $100k+ owner financed sales prices, those buyers want MOVE-IN READY houses.

The objective is to buy houses that just need cosmetic repairs; carpet & lipstick.

MINIMAL REHABS:

I have a relationship with a contractor that works exclusively for my company on these deals. Everything is by MENU, based on the SF of the house;

• Roof = $X/SF

• Flooring = $Y/SF

• Interior Paint = $Z/SF

• Extetior Paint = $Z+/SF

There are exceptions from time to time but for the most part, my contract has the job at those MENU prices. He writes up the job using those menu prices (so I don’t have to go out to the jobs at bid time). If there’s something that doesn’t fit in the menu, we talk via the phone.

EVERYTHING IS STANDARD:

Colors

– Interior Walls / Trim / Doors

– Exterior Walls / Trim / Front door /

– Shudders

INTERIOR:

– Flooring

– Carpet

– Countertop

– Door / knobs / Door Hinges

BATHROOMS:

– Toilets

– Tubs

– Vanities

– Vanity Mirrors

– Tile Surround or Full Shower

LARGE REHABS:

I partner with a guy who does major rehabs…2 to 4 houses per year. He finds the houses/deal. We approve the deal. He does all the work; he deals with the contractors on those jobs. He orders materials. He’s on the job site, etc. My company is responsible for the MONEY and the CLOSINGS. This particular guy is a licensed Realtor and handles the LISTING in MLS, and the NEW LOAN SALES.

You constantly keep opening avenues with particular people that have a passion for avenues you don’t. I hate big rehabs. I saw a guy who loves big rehabs. I investigated. He had no money to buy houses so he was partnering with others who put up the money for him. I made an exclusive offer. He accepted. He only partners with me now. If I catch him doing side deals, I don’t have to pay him on the deals I have going with him.

I want 100% of his effort or non.

I open up lanes as a come across people in lanes I’m not currently working in. Sometimes it works, and we continue. Other times it doesn’t work, and we wrap up on our deals together and then move in.

I have found, as new team members settle into the ways of our infrastructure, they tend to stay. The ones that can’t adapt to our protocol move on, one way or another.

Trust, efficiency, and consistency are always the issues.

–Mitch–

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