Featuring Adam Z.
Background in Construction Helps Win Deals
In 2004, Adam moved to the United States from Poland. Adam was 19 at the time and got into construction work. He quickly discovered, while working for investors, that he loved real estate and it was what he wanted to do.
Fast forward to 2008 when the market crashed. Adam and his wife bought a condo and two years later were able to sell it for a 100% gain. It was after this experience, that they decided to start flipping houses. The two created their acquisition company and dived head first into marketing.
Here’s the story behind his deal…
He sent out a very small mailing to absentee owners.
The seller was an 87-year-old man who was struggling with his tenant. His tenant hadn’t been paying the rent for more than 6 months and he just wanted to be done with the house.
With his experience in construction, Adam was able to price the house around $125k (higher than most other offers). The seller didn’t want to sell for too low and they agreed on $140k. Which Adam knew he can do because he understood the rehab costs extremely well. It will still leave him at a potential of $90,000 gross margin (at the time of this writing, he has not yet started construction).
Both Adam and the seller were pleased with the deal. The seller no longer has to deal with the property and Adam got a great rehab project with immense potential.
Lesson from story:
“Leveling” up your knowledge set (like construction) can help you understand your offers better. Sometimes, when new investors struggle with getting deals accepted, if it’s not a sales/negotiation problem, it can be that they’re offering too low.
- Purchase Price: $140k
- Rehab: $60-$70k
- After Repair Value: $300k
- Potential Profit: $90,000
- How many letters sent: 760(!) (yes we are blown away by this, and this is NOT the norm)
- The list: Absentee owners with high equity
- Mailing piece: Art-deco letters