Our Newest Addition
We asked our newest team member and Acquisitions Manager, Wyatt Wallace, about his experience and perspective in property acquisitions. Here’s what he said:
1) What got you into real estate investing?
In 2013 my Mom and I were looking for a place for her to live when she moved from Illinois to join me in Nashville. We looked at all sorts of houses, but the one that finally felt right, was a 3 bedroom 1 bath foreclosure that needed a little TLC. We paid $60k for it and spent a year renovating. We touched literally every part of that house and really loved the experience; sold it for $40k in profit and realized how cool this business is. I've been involved with real estate in one form or another ever since.
2) What are some things you look for when considering a deal?
When considering a deal, the neighborhood is really important to me. I can do all sorts of things to improve a house, but how do the neighbors care for their own houses? Are the yards mowed and fences painted? Is the trash picked up and are things tidy? Those parts make the flipping either really easy or really hard. You wouldn't believe how easily you can improve a house beyond the neighbors by simply painting and cleaning it up. Once you improve too far, the buyers might love your house, but have a completely negative reaction to the neighborhood. That means your Days On Market will extend, your loan interest will continue to accrue, and you will have wasted an opportunity to actually save money by not doing so much to the house. That knowledge almost always comes from hard knocks, but that's often what this business is all about.
3) What are some red flags when analyzing a potential deal?
For me, it's foundation issues: sloping floors, sticking windows, doors that won't shut or swing open on their own, that sort of thing. I'm pretty sure the Bible says something about building houses on strong foundations, and that really does hold true. The cost to fix major foundation issues can blow a deal, especially if it was tight to begin with.
4) How do you feel about sight unseen acquisitions?
I can do them, but really prefer not to. Many of my senses cannot be utilized with distant transactions and I think that hurts not only my ability to spot problems, but my ability to negotiate discounts for those problems. If I do buy at a distance, it really has to be a deep-deep discount to make up for the sight unseen.
5) What advice would you give individuals looking to get into real estate investing?
Read as many books as you can on the topic(s) that interest you, then find yourself a good networking group and an experienced agent. Ask lots of questions and build a team to help you with everything from funding, to rehab, to legal. That's it, jump in and have fun!