Flipping for Value - Power ON! | Michele Hudnall | Real Estate of Northern Virginia

Investors in #NorthernVirginia have a tough time finding distressed properties as investment “flips” – Why? – They are not distressed enough to motivate a homeowner to sell and lose the equity they have built into the home, however, it is not in the condition that would draw a competitive market value sale.

So what do you do? Start reaching out to absentee homeowners of course! It takes time for them to make a decision but persistence and consistency in reaching out to them is key. They see your name over and over and finally decide to pick-up the phone and I as a real estate professional always pick-up the phone. I remember vividly the Friday call at lunch time while I was in my kitchen staring at the phone seeing a Louisiana phone number and thinking, “Who is this?” “Could this be the homeowner I’ve been reaching out to?” “Do I really want to pick this up?” “Is this SPAM?” ….. For crying out loud Michele, ANSWER THE PHONE and find out already!!! 😎

SELLING A HOME FROM THOUSANDS OF MILES AWAY

The initial call was from an attorney representing the homeowner reaching out to me. Of course, there was a dance of hesitancy on both sides. For me it was the Good News / Bad News call. Just what am I walking into and do I have the time to take on a project of unknown size and scope. For them, I need to build rapport and trust … how do you do this? Answer the questions, be honest and provide information, simple! Be the professional with knowledge and confidence, without pressure and always provide options! The decision on direction must always be in the client’s hands. Simply put, just be you, lead with your ❤️ and give.

THE SITUATION

I have a once in a career opportunity, Waking Up Sleeping Beauty and Powering ON a home after 15 years of vacancy! YES! You heard me right! How is that even possible? It is an interior townhome, thus protected on 2 sides. Most would not have gone looking for the opportunity and others who might receive a call out of the blue might just refer it because it comes with work and a challenge. I love these challenges, they are the most ❤️ warming!

We remain in a very low inventory market and the way to find inventory for those buyers seeking to be in specific areas is to start calling on the absentee homeowners to discover their plans for their property, provide information on it’s current value and provide options. For the absentee owner, the burden is the work it will take to reap market value for their property. This is what I do everyday, share knowledge, remove burdens and create plans!

How do you approach a project like this?

Step One – Make Contact – Reach the current 80+ year old homeowner

He reaches out to me! And still quite an active character! I can only hope to be as active as him at 80.

Step Two – Walk Through Day – Enter the home for the first time, 2/27, with a contractor, to find a time capsule – a little furniture and personal items, not too much and just as it was last left. Visual inspection indicated no visible water, electrical or rodent damage ….. just a time capsule ….. with a gigantic wine closet! 😎 There will be a celebration!

Step Three – Escape to Make Plans! – Go to the lake, buy land (a lot) …. it will be your last escape to the lake for a while 😎 and the start of your own investment journey to Airbnb at the lake …. another story for another time. Wait for/work on estimates, plans, schedule the inspectors, put insurance in place and plan the project!

Step Four – Power ON Week – Power and Water On – 3/10 😬🫣 – Uneventful, I like uneventful after much healthy fear and research. Did I mention I was 2 weeks in with a new broker who likely didn’t know what to do this new girl who called about liability insurance! 😁 At least I called first! 😉 Always a planner!

Step Five – Inspection Week – 3/13 and Schedule mechanical replacements and updates! Time to spend some 💲💲💲! DOH! Should have set up a plan on money transfers and an account, quick recovery. I always want my contractors paid and they know I will chase their 💲 down so they don’t have to!

Step Six – Mechanical Week – Updates/Replacements (power box, some plumbing valves, HWH, HVAC) – Week of 3/20

In 3 fast weeks we will have a mechanically updated, safe and new home. The internal organs and heart beat are pumping in full force and in harmony and Sleeping Beauty is Awake! 😎

HOW TO MAKE IT HAPPEN

Building a great, strike that, Dream Team, has made this possible! This is why I ❤️ what I do! No Fear – Just a process, a network and a Great Team! Now we are on to the pretty stuff to bring this 1979 Contemporary into modern times while maintaining the integrity of the original architecture on a budget that will return at least 2.5X the investment – YOU Heard Me Right!

This is why we struggle to find true flip investments in #FairfaxCounty. Appreciation is such that there is plenty of equity to perform a flip that entails a complete internal update before cosmetics.

The first challenge is understanding the market to provide insight into current market value, then comes estimating the project sight unseen and then working the budget. Just how close was the sight unseen budget with the projected plan of costs? On target until the homeowner decided upon a couple of choice upgrades and now the budget is between 10 – 15% of original estimate. Managing the project to do the right things is where we squeeze out a bit more savings!

It has been a joy working with #FairfaxCounty and Dominion Energy to understand how to safely POWER ON a vacant home and move forward. What a crash course in plumbing and electricity I have received ….. 🙌🙌🙌 many thanks to all of my partners and educators.

Then there is the insurance side of the house to make sure everyone is covered and protected. We’re all friends now and I plan to keep it that way! 😁

❤️ This is my latest Labor of Love and such a great story is unfolding! ❤️

CHOOSING TO DANCE

How and why I won and chose to take on this project, yes, a two way decision to become dance partners.

Persistence and consistency in reaching out to the distant homeowner sitting on a large return if they took on this sale. The obstacle is the burden of selling from a distance knowing there would be a project to manage. This is my passion and strength, making what looks hard, easy in order to reap the reward.

This requires building trust and confidence by knowing the market and being honest and forthcoming with the options. Sharing the data and options freely, which means I put in the work to prepare that analysis. This exercise helps me to continuously hone my skills and stay on top of market conditions.

Could the homeowner take my data and work with someone else? Yes. I believe you have to give to become trusted in these situations and illustrate knowledge, compassion and options to manage and deliver these special situations. These are not transaction churning situations and requires trust on both sides.

If the analysis is take and you are not chosen, it is a blessing, it wasn’t a match and you deepened your knowledge of the market! 😉 It has to be a two way, both sides, actually all three sides (the contractors) committed to the dance for the project to work in attaining the outcome.

BOTTOM LINE

I know when folks think about moving on to their next dream home, selling the current home feels like a burden with a ton of value locked up in it. But How!?!?!?! Who picks the finishes? Who will do the work?

This is what I love doing – helping folks see the forest for the trees and make a plan to obtain the greatest value, with the right investment and a very deep/rich set of dream service providers/contractors.

Follow Real Estate Of Northern Virginia here and @realestateofnva on FB & IG to watch this process unfold week by week! BTW ….. did I mention we are putting in a hardwood floor in keeping with the architecture on the main floor…..and we will remain on budget in sought after Reston! 😉

Let’s talk about how you get from Current Home to Dream Home with your free analysis & consultation of market value and investment scope!

Call your local Numbers Nerd & Hometown Gal!

Michele Hudnall