Foreclosure Deals Coach Podcast

Unbelievable Profits: How You Can Profit from Condemned Properties

June 01, 2023 Chris Lawler Season 14 Episode 33
Foreclosure Deals Coach Podcast
Unbelievable Profits: How You Can Profit from Condemned Properties
Show Notes Transcript

Discover the hidden potential of condemned properties and unlock unbelievable profits with host Donny Coram on the Foreclosure Deals Coach Podcast. Join us for this eye-opening episode where you'll learn the insider strategies to turn overlooked properties into cash-flowing gems. Don't miss out on this game-changing opportunity! Subscribe now for actionable insights that can transform your real estate investments.

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What's up, deal Hunters. It's Donny Corum, your Foreclosure Deals Coach. In this episode, we're gonna talk about doing profitable deals on condemned homes. Stay tuned. You're gonna love this one. Welcome to the Foreclosure Deals Coach Podcast. The real estate market is shifting. The time is now. The Foreclosure Deals Coach Podcast is your home for the mindset, tactics and tools needed to break through your limiting beliefs and find freedom by investing in foreclosure deals. Don't buy a house, buy a deal. You need to get into this right now. And now your host, the Foreclosure Deals coach, Donnie Corum. Hello, hello, hello and welcome back to the Foreclosure Deals Coach Podcast. I am your host. And foreclosure deals coach Donnie Corum broadcasting live from our studios. Listen, before we get into this, please do me favor like this video and smash that subscribe button. Let's keep you informed about the latest and greatest in foreclosure investing. We are talking on this show. About doing profitable deals with condemned properties. But before we get into that, let's bring up our motivational quote of the week. Check this out. This is from Steve Cbol. Now Steve, if you don't know, wrote the books about the millionaire next door, getting rich with investing, things of that nature. Very much an investor. And in this quote he talks about if earning money is based on solving problems and the number of problems is infinite, then your ability to earn money is infinite. A lot of people come to me in the investing space with sort of this. I guess scarcity mentality, for lack of better terms. You're thinking there aren't enough deals to go around. Maybe you believe that, you know, you just, you don't have the money or time or ability to do this and you, you can't possibly find those things to do it. The reality of investing in anything, but particularly in the real estate market is that we're ultimately in the problem solving business and a lot of people have problems with real estate. What causes these problems? Well, you have, divorce is a leading reason of. Problem. People own a property together. They can afford the mortgage together with both incomes. But when the incomes are split up and both have to maintain their own households, they now have to split up that property. They gotta divide the assets. That's a problem you've got. Death is a big thing. These houses go to probate. Families inherit homes every single day. Right. And that's a problem. You've got issues where houses get abandoned cause they have to move outta the state or move outta the country. I recently worked on a deal that we're gonna analyze on this episode where. The owner of the property is in a nursing home, so he's just not in a spot right now where he can manage this property, which was very dilapidated. And adding to the problem, the property was condemned because people were breaking into the property. You got drug addicts, people looking for shelter, especially in a market like here in Colorado Springs where it gets awful cold here. People will do anything to get outta the cold, right? So they find this house that's been sitting for quite some time and they broke into it and ultimately the city condemned the property because it was a hassle, right? So one of this, the kind of the basis of this episode, I wanna explain this to you. I've got a lot of ads out there that speak to foreclosure investing. It's probably how you end up watching this show today is that you interact with me on social media somewhere, right? Will those ads get a lot of positive responses? A lot of people really get. What foreclosure investing is and how it can change your life, and at least your personal economy of nothing else. But there's others out there who feel like investing in foreclosures is somehow taking advantage of other people, and nothing can be further for the truth. You gotta understand that investing in foreclosures is very good for the market. When a property like the one we're gonna analyze today goes condemned. And drug addicts are living in it. It is bringing down the neighborhood value. I'm not happy about the idea of anybody losing their home. Okay? That's not the base of this business. I'm not preying on people who can't help themselves. That's not the objective at all. However, banks foreclose on homes all the time. It's a normal part of the process. People have car repossessions all the time. Would you not buy a car if you had known it was repossessed cuz you were worried about the previous owner of the car? You see how silly that sounds when you say it that way? Absolutely not. The car is usually sold pretty close to market value. Well, what if that car also needed some work? Well, this is a problem for the homeowner. Not only if they lost the property to foreclosure or then the process of losing the property of foreclosure. They've got other issues that this house is causing. In the case of this condemned home or condemned homes in general, there's a fine system here in the city of Colorado Springs because they got recently overrun. With a lot of people whose houses suddenly got condemned because they were abandoned. These houses may have sat for years with nobody caring, but now every city of the country is facing a little bit more drug usage. Every city in the country is facing a little bit more crime than usual, right? That's just happening. You wanna call it the stress from Coronavirus, the Covid pandemic, the unemployment market. There's a series of reasons why this is happening, but economically it is in fact happening. Okay? So. You stepping in as an investor and getting that house secure for one thing, but then properly remodeled and then sold to a homeowner who will love it and take care of it, not only serves the needs of that homeowner, who without this process, might not be able to afford a home at all. Think about if builders were the only place where you could get a nice house. Builders, if you're in any market, are obviously charging a lot for new, right? Just like when you buy a new car, don't you pay a little bit more for new? Of course you do it if you got the capital to do it, the income to do it, and you wanna get a new home. I'm not knocking it. I bought a new home years ago, but if the only homes available for sale were new, think about what that would do for the first time. Home buyer prices would be excruciatingly high because the only available properties would be new. The idea of buying a property below market. Fixing it up and selling it actually helps the market. Okay, so what we're gonna talk about is that you need to solve problems, and if you're big on solving problems, you can make an infinite amount of money by working on solving problems here. Just getting into that, what I was talking about here. Check out this article. I'm gonna share my screen here a little bit. We've got an article here where the local news, there's a suspicious death on a house that was condemned. Right, so people are living in this house, and I'm not saying everybody in the house had a problem, but because of the suspicious death on the property, it is now condemned. If this house now sits, what do you think is gonna happen to it? Right. There were already problems with this property. Look here, there were exposed wires, loose leaky pipes, flammable material, all sorts of unsanitary conditions. The owner of this property, I mean, they're collecting rent, right? It's not that they don't care, just a lot of times they're kind of detached from it, right? They want to have residents living in the property, but if it's unsafe and dangerous and somebody died mysteriously in the property, the city was faced with only one choice, which was condemned that property to take it out of an unsafe condition. Cuz stuff like that, if it happens, as once is likely to happen again. So they condemn this really nice house. In the, uh, upper North end of, I'm sorry, upper north end of downtown Colorado Springs. Right? Nice area. And unfortunately, these families were displaced. If somebody doesn't step in now and make this problem go away, I can assure you it is just going to get worse from here. So as an investor, you are now. Taking the market as a whole and looking at where those problems are. Okay? And if you believe you can solve those problems, you can not only help the real estate market, you can help homeowners, you can assist renters, you can assist your own pocket. Cause you should make money for doing this. And think about how many professions make their living. On helping people, right? Your dentist is not inexpensive. He's probably compensated pretty well for keeping your smile clean, right? A good lawyer out there is helping people, whether it's in criminal defense, on something they either did or didn't do, a divorce lawyer, et cetera. The really solid professions that make their living on helping people to solve problems can make an infinite amount of money because there's an infinite amount of problems. Well, one of the problems that we're discussing on today's show, Is dealing with condemned properties. So very recently, as I mentioned, we purchased a property that was condemned. We located the homeowner via our TV ads, so we had a lot of influx of calls. In this case, the call came in not from the owner, but from the homeowner's sister who was seeing the notices coming in the mail about the city, finding her brother. On this property because the property was sitting empty, it was condemned, and the city had to go out and board up all the windows and the doors so nobody could get into the property and, you know, do drug activity. Cause more problems, add more criminal element. When things are out of plain sight and they're bad, it's easier to get them done. Right. So the city condemned this property. Well, the, the, uh, the people, the squatters were undaunted. They kept breaking into the property over and over again. The city had to go in, scare the squatters off. Reestablished security on the property by boarding it back up over and over and over again. Needless to say, this property was a problem. For the homeowner, when we stepped in, we determined what the house was worth, which in this case fully fixed up was nearly$400,000. And this is gonna blow you away. But the, the purchase price originally was like 120 grand. And because we found some additional problems with, well, the property, we got'em down to wait for it. 95. Thousand dollars. Now, is this a good deal? Well, on the surface that seems obvious, but you've gotta learn how to do your own deal analysis. You can be confident in that deal analysis when you're doing it. We're gonna hop in and look at, right? But today I'm gonna show you a deal. Check analysis. We are a proud sponsor and affiliate of Deal Check. So if you decide to sign up for the deal check application, please, please use my affiliate link. I really appreciate that because it gets me a little bit of money. But also I will help you to get your deal check set up. If you sign up using the Privy, uh, sorry, deal check affiliate link, I'm happy to do that as my way of thanking you using my affiliate link. It's not hard to set up, but once you understand the power of the steel analysis, you're absolutely going to love this software. So let's log in. Real quick here, and these are the properties that I've been analyzing re recently. Here's the property in question. Okay, so you put in and I, I was looking purchase price. We were whole the property, but what we really wanna see when we're looking at the profit margin on this is the. Cops, what could this property potentially sell for fully fixed up? Well, what we know about it is a two bedroom, one bath with 1,154 square feet. Okay. Real quickly, deal check looks around in the area and finds properties that have similar characteristics. It's not exact, but it's very similar. Here's one on East Cawa. 1.1 miles away. Went for 4 94. Four. Here's another one, one mile away. It's got a third bedroom, so we don't necessarily wanna use that comp, but it went for four 20. Another one here in Columbia. Little bit further away than I like. I like to keep my comps pretty close to a mile if I can, but this one went for 3 74 over and over again. We can look at the various comps around this area and we find that this property in. Fully functional condition should go for 375 to maybe 400 grand. So what am I gonna do with it? I picked it up for a hundred grand. I could certainly remodel it, but it's a pretty major remodel and I'm working to help my clients get going. This is not a property I would put any first time flippers into. It is just too complicated of a flip. You can see by a nearly. 300 K margin that this is not for the faint of heart. This har this property needs a good amount of work, but even at a good amount of work, the rehab budget on this is expected to be about 120 to$150,000. So our exit strategy, we have a buyer on the property at about one 70, and they're gonna, they're gonna spend the one 20 to one 50 on it. Let's just round it up. And say they spend about 1 25, give or take, they're into it for 2 95 and selling it for a minimum of 3 75, which is a good day at the office, and could be in the mid fours to upper fours, depending on the level of finish and how far they go with the remodel. The point is, it's a win-win situation across the board. The seller of the property, although they sold this. Property dirt cheap. They simply did not have the means to do this remodel on their own. Truly an investor, in this case, me was their only choice. So we're solving a problem. This guy in a nursing home, barely getting by financially and personally and physically doesn't have the effort to go out and work on this property and get it back into condition, especially considering how extensive. This remodel was going to be so by negotiating the proper deal on this, now I have a property and a problem that I've solved. The next problem is there are investors out there who want to do deals. They got the construction chops, they've got guys on salary. They, some guys that I work with on my, in my business, I'm sorry, I'm still saying guys, ladies, I don't mean any offensive. Some crews that I work with, they, they have to keep their crews busy. They've got families to feed. Okay, so if they stop producing deals, if they stop doing remodeling projects, those people have to go find work elsewhere. That's not good for anybody. So now by keeping them busy, by adding some value to the market, by finding these condemned properties and taking them off the market so people can utilize that, that. Economic resource to invest money in materials and labor to bring that property into current condition. The investor's gonna make a lot of money for doing this deal. I'm gonna make a decent amount of money for doing this deal. The seller gets rid of a problem house and the. Whole market around that property is thankful that one less property that could be a problem is no longer a problem. That for me guys, is a win, win, win win. So how do you find these condemned properties? Well, you know, finding deals, what I do to find deals pretty much across the board is privy. I use Privy because Privy is a great tool for locating deals. I'm gonna share my screen again here so you can check this out. But in Privy. Normally I have this filtered automatically to show us fix and flip potentials in the market. But in this case, you've got pre foreclosures. You've also got vacant properties where you can filter on that, and you've got what they call zombie properties, which is often abandoned properties that have been identified by the AI as homes that are not currently being tended to. The mail is kicking back. Stuff is not happening that should be on this property, and as a result of that, those work out to be solid deals. Now, I don't find a property every single day using that search criteria, but to give you an idea, You're gonna find zombie properties pre foreclosures all across the country by simply putting in the right search criteria and analyzing that deal properly. So there are deals everywhere. They may not necessarily be in your local market, but having the means and desire to work outside your local market is helpful. Furthermore, Um, being patient, understanding that you're not gonna find a deal every single day, and that deal hunting, whether it's condemned houses or otherwise, is gonna take time In lieu of using Privy, you can go to your local county, right? You can talk to your city planning division, and I promise you, every city everywhere has more condemned properties than they want to deal with on a day-to-day basis. When you come to them as an active investor who can take those properties off of their hands, Fixed them up. And then resell them for a profit. I assure you the, the local, uh, guys who are dealing with them, I'm dealing with the guys who deal with con condemned houses every day. And I gotta tell you, they're sick of them, okay? Having to go and resecure those properties over and over again, dealing with the squatters, all the situations they gotta go through on a day-to-day basis. These guys gotta basically walk around armed to really feel safe, cuz they don't know what they're going to encounter and when they encounter somebody, they gotta involve the police. So now the police. Resources are being drained and having to deal with that all across the board. Condemned properties are a problem, so if you get into the problem solving business as a real estate investor by solving problems, you should be compensated extremely well. For the value that you bring to the market. We're not taking advantage of people. We're not kicking people outta their homes. Think houses that are condemned, usually something happened to where that property had a problem anyway, like the article I showed you, where there's electrical issues, there's other issues that need to be resolved, and the home seller. For whatever reason is not paying attention. They're like a slum Lord. They don't care. It's causing more problems in people's lives, and they either don't have the financial resources nor the desire to handle it. If you can step in and make that go away, you should be compensated extremely well. For doing so. So what's the action item on this? Well, if you haven't done so already, you wanna hop onto Privy, get that app, please use my affiliate link. The link is posted below to get involved with Privy and understand that there's properties everywhere that have a problem. Sometimes it's an obvious problem. It's been a divorce or a death in the family, and the house needs a ton of work. And sometimes it's not as clear of a problem once you've determined what the problem is. If you as a deal hunter, make your business solving problems, I can assure you, you can make millions upon millions of dollars in the real estate investment space. Am I saying it's easy? Absolutely not. I'm simply saying it's very lucrative for people who want to break outta the shell of normal income generating activities like the job you may be working at that you don't care for very much. Right, and breaking into looking at the housing market as there are problems that you can solve readily by adding some money, some knowledge, some market research. Some construction, et cetera. When you bring those properties back to market, you'll be handsomely rewarded. So take some action, get privy, reach out to your local city, ask them how they handle condemned properties in the area, get on that list and start scouting condemned homes. Cause I assure you, by taking those properties off the city's hands, you're solving a bunch of problems. You can make a lot of money doing it, and the net effect will be money in their pocket and a lot more happy people. Okay. Investing is not the bad guy. Image that some people make it out to be. When you use foreclosure investing, I get it creates this mental image of people losing their homes. And obviously in the 2008 and 2009 era that was the case. A lot of people lost their homes through robo-signing. A couple other issues that were not correct in the last foreclosure crisis. I fear that some of that attitude is carried over, and I don't mean to be heartless. But the reality is, is somebody is going to benefit from these foreclosed homes. It's either gonna be the banks who already have way too much money, you know, as is, or it's gonna be the individual investor who takes the risk, steps out on faith, does the homework, gets the analysis, gets a business coach. Takes those properties off the market, fixes them and sells'em at a profit. There's a lot of steps involved guys, but if you will take those steps, I can make them very simple. The first step, if you really wanna do this, if you're committed to getting your investing career started, I implo your reach out. Message me, schedule a call for the coaching assessment, and when you get the basic idea of what I'm looking for, we will hop on a call and after a few minutes I'll be able to tell you what certain certainty if coaching is the right move for you in your investing career. I'll also be able to tell you if it's not, you know, I have my course, the five Fs. A foreclosure investment system that can get you started on your own. If you don't have the money, you're not quite at the right place to get into coaching, that's okay. Don't feel bad about that. We've all got to start somewhere. But if you aren't a financial spot and you just don't know where to get started, I would love to be your first stop in assisting you and breaking through your limiting beliefs, getting the right mindset, employing the tactics that I use. Every day to do deals and using the tools that I use to make myself successful in the real estate market. So that's really our show for today, guys. There's a lot of stuff happening with condemned homes and I think as we see unfortunately, the, the surgeons of people losing their jobs, that's gonna happen. It's a market cycle. It's unfortunate, but it's reality. Okay. Properties get condemned every single day. If you're not keeping up with the repairs on your home, at some point, either you're gonna have to fix the home or it's gonna get condemned and somebody else got to fix the home. In either case, that's the route that all properties gonna have to follow as you as an investor wanna capitalize on that. If you wanna change your family, Future with this process. Learn about where we condemned properties are. Use the privy search and reach out to your city today to find the best deals and start working through those problems. That's our show for today, guys. Once again, please subscribe to this YouTube channel if you got some value about. On this, like this video, subscribe to the channel, share with your friends. Let's create a revolution of deal hunters all across the country that are solving these problems on a national level, keeping the real estate market afloat and just making better neighborhoods for everybody. With that, this is Donnie Korum, your Foreclosure Deals coach. Thanking you so much for tuning in each and every single week to the Foreclosure Deals Coach Podcast and reminding you again, don't buy a house. Buy a deal. Thank you for tuning in to the Foreclosure Deals Coach Podcast. If you like what you heard here today, remember new episodes are uploaded weekly. Subscribe wherever you listen to your podcast. Do you want more of the foreclosure deals? Coach, are you ready to learn the mindset tactics? And tools required to be a successful real estate investor. If so, click the link below to schedule a one-on-one coaching Call today with Donny Corum, the Foreclosure Deals Coach to determine if coaching is right for you. And remember, don't buy a house, buy a deal.