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Copyright 2004-5 Homesolutionssandiego.com
All Rights Reserved
admin@homesolutionssandiego.com
All Rights Reserved
admin@homesolutionssandiego.com
Your resource for real estate and home decorating in San Diego
by: Jeanette Joy Fisher
If you want to become a real estate investor, find a "fixer-upper" owned by an anxious seller. Finding
distressed houses at bargain prices, fixing them up, and then selling them on a consistent basis can make
you a millionaire.
Why Sellers Sell At a Discount
Homeowners' problems often prevent them from staying on top of their home's upkeep, and factors such
as job loss, divorce, serious illness, various addictions, or other personal problems quickly overwhelm
them. These sellers can't make the needed repairs because of financial or physical limitations, and when
that happens, their home becomes a low priority and sometimes will go into foreclosure.
Look for the "Triple D"
Home sellers with three problems give beginning investors a great opportunity. A "Triple D" is a Doghouse,
involved in a Divorce, and in Default. The label "doghouse" comes from Southern California Realtors who
used this term to describe the worst fixers. These houses maybe "tired" and need only cosmetic work in
order to favorably compare with other homes in the area.
What to Look for in a Doghouse
The hardest house for a homeowner to sell is a "doghouse," "dump," or "fixer-upper." These run-down
houses scare off most buyers, who don't have the money to cover the down payment, closing costs, new
furniture, carpeting, appliances, roof repairs, and other deferred maintenance required to bring the home
back into top condition.
As you look through the classified ads or at realtor listings, keep an eye out for terms like "handyman
special," "as is," "fixer," or other tell-tale words. Also have your agent use similar terms when scanning the
Multiple Listing Service for your target area.
Once you've found a property that you can turn from doghouse to dollhouse, find out the seller's problem
and then offer a solution. Distressed sellers frequently experience financial problems and need cash as
soon as possible. Therefore, if you're ready to close quickly, you'll be set to negotiate a lower sales price.
How to Close Quickly
Find an experienced lender and get yourself not only "pre-qualified," but also "pre-approved." Taking that
second step assures worried sellers that you already have your loan in place for their property, and this
puts you well ahead of other potential buyers.
How to Know When "Bad" Is Good
When you first start out in the real estate "fixer" business, you'll want to look for "ugly" houses needing
only cosmetic work. Look for entry level fixers that just need some cleaning up, painting, and carpeting.
When you're new to the fixer game, always remember your limitations and use caution when considering
houses needing structural repairs. My husband replaces structural beams, sub-flooring, walls, plumbing,
and electrical systems, but he acquired those skills after years of experience.
If you find a house with structural problems, get estimates from reliable contractors to do the work.
Experience teaches you how to do more over time. Until then, rely on experienced professionals to do the
repairs. Take professional estimates into account before deciding whether or not to purchase an
investment property.
The Easiest Houses to Sell
A dollhouse, located in a popular neighborhood, sells the quickest. For instance, we once sold a home we
named "Orange Tree Cottage" in just three hours! To qualify as a dollhouse, a home must be in a location
that buyers want and must offer the number of bedrooms, bathrooms, and amenities they're seeking.
Beyond the price, however, buyers purchase the house that meets both their basic requirements and their
emotional needs.
Filling Buyers' Emotional Needs
After many years of investment experience, we've found that using Design Psychology and Marketing
Psychology techniques greatly increases our profits. Both concepts go far beyond "curb appeal."
For instance, we use colors that target our prospective buyer's income level and match the selling season.
Generally, buyers of higher-priced homes prefer complex colors, and using cool colors during hot weather
and warm colors in cold seasons makes buyers feel more comfortable. We also paint the front door a
happy color and entice buyers into the house by placing potted plants on the porch.
Over the years, we've bought and sold dozens of distressed properties. By using caution and common
sense, as well as following a few simple rules and using Design Psychology strategies, you, too, can
become a wealthy real estate investor!
(c) Copyright 2004, Jeanette J. Fisher. All rights reserved.
About The Author
Jeanette Fisher, Design Psychology Professor, is the author of Doghouse to Dollhouse for Dollars, Credit
Help!, Joy to the Home, and other books. Jeanette teaches Real Estate Investing and Interior Design
Psychology. For more articles, tips, reports, and newsletters, see
http://www.doghousetodollhousefordollars.com/pages/5/index.htm.
JeanetteJoy@gmail.com
Books by Jeanette Fisher:
-Doghouse to Dollhouse for Dollars
-Sell Your Home for Top Dollar--FAST! Design Psychology for Redesign and Home Staging
-Credit Help! Get the Credit You Need to Buy Real Estate