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Rehabbing

The 70% Rule and Why You Should Break it 100% of the Time

If you’ve spent much time studying the business of real estate investing, specifically fixing and flipping houses, then you’ve probably heard of the 70% rule. It goes like this… If the after repair value (ARV) of a distressed home is $100,000, then you should never pay more than $70,000. In other words, your purchase price should not exceed 70% of the ARV. This is what “they” call the 70%...
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Why You Must Have This Before You Start Fixing and Flipping Houses

They all looked so… Desperate. Tired too. As the speaker, slickly dressed in a dark blue suit and matching tie, addressed the half-full room I could feel the sales pitch rapidly approaching. I recall looking around at the attendees. Could any of them really afford the real estate investment program this guy at the front of the hotel conference room was about to sell? Probably not...
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Non-Permitted Work: A Fix and Flip Investor’s Nightmare

My spider senses were tingling. Something didn’t feel right. It didn’t look right, either. The house, located just east of the Milwaukee airport, had a lot of curb appeal. The sky blue vinyl siding was brand new. And the roof was flawless. The houses on each side, and across the street, were adorable. The price was definitely right. But, stepping inside the cute little Cape Cod style home...
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Why You MUST Ask (Almost) Every Contractor This Question

My brother lives about three hours away in Yuma, Arizona. Situated halfway between Phoenix and San Diego, this little desert town is known by most people as the point you stop to get gas on your way to the beach, or on your way home from it. Growing up in Yuma, I appreciate it for more than just a restroom stop and place to grab a combo meal at the interstate McDonald’s. What I love most ...
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Deal or No Deal: 3 Problems Price Can’t Fix

He was standing on the outer fringes of the crowd. I don’t remember his face, only the writing on his T-Shirt. The words read… There is no problem price can’t fix.  The man was a bidder at the Maricopa County Trustee’s sale. Held daily on the courthouse steps in downtown Phoenix, this auction attracts a crowd. At least it used to. Immediately following the real estate market crash of 2008...
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6 Things That Will Balloon Your Rehab Budget

You probably own a car, or truck. And, if you own a car or truck, then you’ve probably had to have it repaired. There’s nothing worse than knowing you have something wrong with your vehicle, but not knowing how much it’s going to cost to fix it. Whenever we have something wrong with one of our cars, my wife and I like to play the “how much it will it cost?” game. It’s kind of like the gam...
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The Question Every Fix and Flip Investor Should Ask

When I first learned that my wife was pregnant 14 years ago, I was certain we’d have a boy. I’m not sure why. At the time I guess I figured I was a boy, and my only sibling was a boy. Plus, I wasn’t good with girls. In elementary school I had no interest in them. And by the time I was interested in girls, they had no interest in me. My biggest problem was I didn’t know how to talk to them. I...
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5 Inexpensive Items That Give Your Fix and Flip a Million Dollar Look

They call it the Happiest Place on Earth. As I child, I loved going to Disneyland because of the rides. Each of them provided a unique experience. One minute I was a swashbuckling pirate sailing through the Caribbean, and another I was traveling at light speed through deep space. Okay, maybe it wasn’t minutes between rides. More like hours. Those lines were terrible. These days when I...
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The 4 Categories for Every Fix and Flip Project

Each Saturday I ask my wife “What would like me to get done for you this weekend?” Then she reads me her list, which is longer than my arm. My next question for her is “Okay, what’s the most important thing on this list you want me to get done for you?” I once heard that if everything is important, nothing is important. This truth applies whether you’re getting your honey-do list done ...
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Why You Should Partner Up to Fix and Flip Houses

Since 2009 Manny Romero, my business partner, and I have fixed and flipped more than 100 houses in Phoenix, Arizona and Milwaukee, Wisconsin. Our partnership began out of necessity. At the time I was working for a local real estate investor in Phoenix who was buying houses at the courthouse steps (known as trustee’s sales in Arizona). Manny was on the road, a traveling salesman of sorts. ...
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