Tuesday, October 23, 2007
Flipping homes in Chicago: A family affair
My brother-in-law called me out of the blue yesterday. He’s driving around the Humboldt Park neighborhood and asks me for market information concerning a home going to auction.
Now, this is not entirely unusual as he’s been in the mortgage business for awhile. But, homes going to auction? What the hell are you driving around Humboldt Park for?
Turns out he has become a real live house flipper with a couple partners. News to my wife and me. And in perfect brother-in-law fashion, he gives me a last minute “pop-in” phone call for some really important information. No problem Bro, I’ll just drop all my clients and the three deals I'm in the middle of…
And I did. See, it’s my wife’s sister’s husband, and they have two kids. All I was thinking is if I “prioritize” him, I’m taking food out of their kid’s (my nephew’s) mouths and Thanksgiving this year will be REAL awkward… well, so I do the research on the spot. Look, I’m a pretty good Realtor and it burned me a little that the dude’s in my city (he’s a dedicated suburbanite) snooping around real estate and he didn’t seek my advice way before hand.
BTW, the numbers show house transactions down %50 compared to the 2nd and 3rd quarters and home prices down by about 10% in that same comparison. However, move-in condition homes under $300K have sold in relatively short market times.
Okay, my ego aside, the brother-in-law and sister-in-law are pretty smart people and they have consistently showed each other support in these types of ventures. And brother John is a good numbers guy and has some contacts here and there. So, I believe they’re on the right track. But what about me? Turns out they don’t have a Realtor on the North Side and they could use some specific consultation. Thanks for the bone… dude.
Here’s what they need and here’s what I’m good at:
Right now they are focused on a certain price-point in emerging neighborhoods. They find the houses now, usually bank owned (REO) that go to auction. But they need advice on the market statistics concerning the single family homes, consultation on the finishes of the house, and a Realtor to market and sell it. Check, Check and Check.
If this thing takes off, maybe I’ll bird dog some houses too. But the foreclosure and auction game takes a lot of concentrated time and effort. My everyday bread and butter is being one of the top Buyer’s Agents in the city for residential real estate… and I’d be taken away from client research if chasing foreclosures.
However, because I do represent so many transactions all over the city and therefore know what buyers want, I’m in perfect position to consult on things like location, price, finishes and marketing.
This could be the start of a family empire and an HGTV show.