A Statement in Support of Private Real Estate Investors

We have all seen them - handwritten and staked in the median of a busy intersection. It’s the sign that says something like, “I buy ugly houses with cash!” Those signs are the equivalent of throwing a bare hook in the lake and waiting to catch a huge bass. The crazy thing is that it actually works… every once in a while. Similarly, it’s the reason why I receive non-stop texts, emails, and calls from investors, wholesalers, and their contracted telemarketing freelancers. “Do you have anything coming soon that needs some work?” If one in ten-thousand contacts leads to a profitable deal, then it’s a win according to this logic. While it does work, I think there’s a better way, and I’ll talk about that in a later post.   

For now, let’s focus on the man or woman in the arena:  the individual real estate investor. Successful private investors, especially those in the business of flipping homes, are a different breed of people. Significant financial risk; unforeseen repair costs; constant stress; difficult contractors; high taxes; shifts in the market; and long periods between pay days are just a few of the challenges that you face when buying, renovating, and re-selling a home. There are easier ways to make money. One thing is certain though:  the people who do this for a living are in it for more than just the financial reward. I think what keeps them going is a combination of the love of the renovation process, the potential for financial and personal freedom, and the challenge of it all. It’s a unique field where entrepreneurship, science, and art all meet in a high stakes gamble that may or may not work out deal after deal. The best house flippers produce beautiful, move-in ready homes while making enough money on each project to both support their family and continue growing their business.

Despite the risks, challenges, and ridiculously high capital gains taxes, these ambitious business people perform a massively important service for our communities which often goes unnoticed. Hopefully, in some small way, this helps in that regard. In most cases, they take a house that otherwise wouldn’t even be livable and turn it into something that’s desirable for a young family to buy and call home. They inject life back into aging, dingy, and undesirable neighborhoods. And, in the process, they enable various supporting professionals to provide for their families. The impact of the ecosystem that they build and manage is significant, and all of these things are worthy of praise.

For what it’s worth, here’s your day in the sun! Our communities are benefiting from your hard work! Thanks for being you, and keep at it!