For the 451st episode of Mail-Right Show, Robert Newman, and Jonathan Denwood invited Ron Jones to give insightful discussion about property development, how to communicate effectively, assess developer credibility, and negotiate better deals in real estate that align with your goals. Ron Jones is a property developer specializing in fixing and flipping properties for over a decade. He is a seasoned real estate professional based in Huntington Beach, California, adding value to properties by buying, improving, and selling them. Robert Newman founded InboundREM, a marketing company specializing in real estate lead generation and SEO, to get started with inbound marketing efforts. Meanwhile, Jonathan Denwood co-founded Mail-Right, a lead generation system that offers exceptional WordPress websites, ranging from theme-based and semi-custom to fully customized designs.
How to Leverage Your Experience During Conversations About Property Development
When talking with real estate agents, appraisers, and investors about property development, it will often vary based on their approaches to valuation and investment. While discussions may only sometimes dive deeply into valuation, understanding property valuation is crucial in property flipping. When you master resale value prediction, you will have a competitive edge, as many aspiring flippers struggle with determining potential sale prices. Knowing resale value prediction simplifies decision-making and enables effective navigation of the complexities of real estate transactions.
Experience with foreclosure sales also helps you learn strategy and expertise, as you will learn an effective model for assessing properties along the way, and you can refine your approach and begin securing deals.
In California, tenant laws create challenges for landlords but present opportunities for investors. Buyers often purchase properties with non-cooperative tenants, resolving occupancy issues in exchange for attractive pricing. Value is created through property upgrades or addressing structural problems while weighing the cost of repairs against potential profit margins.
Determining What Makes a Property a Good Deal
When evaluating a property’s value, buyers and investors ask whether it fits their needs and desires. For an agent, is the property suitable for you? Does it meet your regarding space, and features like the garage? Investors analyze the neighborhood and determine whether the property can blend in while still being a desirable and competitive option. This can be done by measuring the property against comparable homes in the area.
The answer to whether a property is a good buy often boils down to comparable homes. However, remember that, particularly in places like Southern California, houses will always not be the same. The desirability of the Property will always vary depending on the neighborhood, the buyer’s preferences, and the market conditions.
Investors also often try to capture the most attractive features of a property, such as a well-designed floor plan, scenic views, or a spacious yard. For example, a property owner in Van Nuys, California, made extensive upgrades to their home, including a pool, Jacuzzi, and regular repainting. While similar homes in the area are listed for $890,000, the owner believes their property should be worth 10 to 20 percent more due to these improvements. The validity of this depends on the buyer’s perspective because they may see it as a great deal, while others may not.
In residential properties, emotions heavily influence decisions, with buyers drawn to features like a modern kitchen or bathroom. Commercial properties, on the other hand, are driven by financials. While efforts are made to make single-family homes as appealing as possible, no property will meet everyone’s needs.
Regional and National Real Estate Markets: Trends and Outlook for the Next 18 Months
The housing market outlook is optimistic, especially in California, where interest rate cuts have not yet had the expected impact, likely due to the upcoming elections. However, a Fed rate reduction in December is expected to drive activity during the buying season f