#039: How to Flip Houses in High-End Areas - a podcast by Gavin Timms

Recently, I finished a flip in Maui where we took a $955,000 house, renovated it, and then sold it for $2.65 million. And I’m currently looking at repeating the process in the South Arcadia area of Phoenix. If flipping houses in high-end areas intrigue you, or you’re ready for a new challenge, let’s talk about the differences between value-add flipping or completely tearing down property and building from the ground up, and what you need to do to get a property up to the high-end price tag.

Just remember, before you start this process, the money is made when you buy the property. That means you’ll have to negotiate for a price that gives you the flexibility to do whatever you need to do to the property to get the value up, but there’s one small caveat. The sellers on a million-dollar house are a little more savvy, so it’s unlikely that you’re to be able to lean on the normal creative financing solutions that wholesalers prefer. The high-end seller is going to want more from you than your word.

They’re going to want:

• Proof of funds
• Your website address
• Examples of your past deals

Then you’re going to need to decide if it makes more sense to just add value to the existing structure or knock down the entire house. And of course, because the finishes on a high-end house are going to be different than the middle-of-the-road $200k houses that you may have been working in before, you’re going to need contractors or developers who can handle crown molding, marble floors, or whatever your designer wants to put in the house.

Check out my Maui case study for a more in-depth look at how even virtually flipping high-end houses can be lucrative and rewarding for real estate investors.

What's Inside:

• Why you’ll want to use a double close over an assignment fee when working with high-end properties.
• Does your network currently have the right kind of contractors to work on million-dollar homes? My suggestions for finding some upscale contractors.
• You’re going to need a slightly different approach with sellers of high-end properties because they’re a little more savvy than a burnt-out landlord trying to unload his most troublesome property.

Further episodes of REI Network with Gavin Timms

Further podcasts by Gavin Timms

Website of Gavin Timms