Real estate investment opportunities come in big and small ‘packages’. For many investors, the small-to-medium sized, single-family house refurbishment, or “flip,” is often attractive due to the speed of the project. iFunding interviewed one of its real estate operators that specializes in quick-redesign flips and makes use of social media to promote her projects. Wendy’s projects can be found at her customer facing page: www.facebook.com/dwellingstudio or her peer-to-peer focused account, http://instagram.com/flippinwendy .
Q: Wendy, what’s your background in real estate?
A: I’ve been refurbing homes since 2006 and have completed about 20 properties since then. My mother had always been a DIY-er and money was tight, so that’s probably where I caught the budget conscious redesign bug. Right around ’06, some of the early house-flip TV shows appeared on cable, and after watching I thought I could make a go with my own projects. I started by doing cosmetic updates to my own home, then branched out from there.
Q: What types of properties do you invest in?
A: I focus on small, single family homes: 1,000 to 2,500 square feet, which in my Cincinnati area typically have an all-in, purchase and construction cost of $100,000 to $250,000. They can take from 4 to 6 months from close (purchase) to close (sale). That includes 3 to 6 weeks to renovate, 2 to 3 weeks on the market, and 45 days to close after going to contract.
Q: Given the projects are relatively straightforward, what kind of help do you rely on?
A: I often will look to wholesalers to locate properties with potential for a good return, then visit the sites immediately. I also use contractors for the on-the-ground demolition and construction. My very first project was completely DIY but took 6 months of work, so I’ve since become a fan of investing in trusted contractors to speed up project turnarounds. In terms of selling, I will promote the home via social media, as well as turn to brokers for assistance. And finally, I have a young daughter who I just took with me when first looking at the property I’m fundraising on iFunding. She tags along with me to the job site when it’s safe. I like to say tongue-in-cheek that she will be my next assistant.
Q: You mention social media to market your projects. I notice you don’t have your own website up yet, but are prominent on Facebook and Instagram, as well as a few other sites. What’s your online strategy?
A: First, I plan to have my own website soon. But my first focus is on the quality of the projects themselves, which is most important to selling the homes at a profit. Beyond this, a number of the social media sites work quite while themselves. Bigger Pockets (https://www.biggerpockets.com/users/flippinwendy) is an excellent community to discuss real estate questions.
In addition, Facebook is a great way to promote fixed-up homes to potential buyers. You can target by location, age group, and interest such as HG-TV (www.hgtv.com), the home investing and design cable channel. I placed my first ad recently and received 5,000 click-through views back to my FB page (www.facebook.com/dwellingstudio). The click rate was close to 10%.
I use Instagram for connecting with other flippers and interior design pros. Previously, I had written a blog (for travel) but found writing takes too much time, especially when I think about my projects more visually. Instagram (http://instagram.com/flippinwendy) provides a platform where I can share my work quickly, as well as get feedback from my peers. It has really been helpful in connecting with others in the same line of work.
Q: Let’s return to your project investing strategy. Tell us more about neighborhoods, design approaches, etc.
A: I stay focused on Cincinnati and its suburbs, which I know very well (with the exception of the West Side). There’s a particular district that has caught my eye, the “Over the Rhine” neighborhood. A few years ago it was more downtrodden, but now it’s turning into a hip, artsy scene. You have to carefully consider these projects and think about the opportunity, street by street, but there’s potential for upside returns here.
My favorite part of the flipping is the design. I try to make each bathroom and kitchen a little unique, to fit the space and the feeling of the house. Then there are common upgrades, like granite tops in the kitchen, that sell well. I look very closely at tile patterns and at how all the home’s finishes from stone to wood complement each other. Depending on the house, there may or may not be budget and timeframe for opening up the floor plan. We examine the location of load-bearing walls and beams to make an initial decision on that.
Q: Finally, what’s one of the biggest lessons you’ve learned about real estate?
A: I’ve learned that staying focused on a style and size of house makes your projects more reliable and efficient. I have put systems in place to make the entire process run more smoothly, within budget and complete on time. Early on in my real estate career, I turned a 2-family home into a large single family. The size added complexity to the design plan and I found potential buyers of larger homes tend to be more particular about layout and customizations. Since then I’ve narrowed my focused to modest-sized, single family homes. With more focus and a bit of luck, that hopefully will enable me to do 10 projects this year. I’m already on my fourth!