As you may know if you peruse this site, I am a financially retired, under market value property wholesaler and investor in San Antonio TX.
I am seeking cash partners to purchase 3 bedroom, 1 bath distressed properties in San Antonio TX. I find the houses. You fund the purchase. I do the rehab in 30 days.
We split the profits 50/50. Or, I can owner finance/rent the property out for you.
Remember, I handle the entire project from acquisition to rehab to resale. You ONLY FUND the deal.
My goal is to transform the city of San Antonio TX into homeowners and to improve neighborhoods.
I particularly like to work with out of state property investors who once bought San Francisco investment property, Los Angeles investment property, and Seattle investment property.
The San Antonio investment property market has really heated up in the last 18 months. Back in 2014, it was possible to buy houses for $30,000, do $10,000 in rehab at most, and owner finance them for $59,000.
Or, you could buy an under market value property for $40,000, do $10,000 in rehab, and flip it for cash and make $30,000.
Making money in San Antonio investment property is still very possible and I do it every week, but it is more challenging now. The economy has improved a great deal, and San Antonio TX is a booming market, with great numbers of people moving here every month. With all of the construction going on, there is plenty of blue collar job demand.
Lower gas prices have also put more money in people’s pockets, which leads to more economic growth and spending.
All of this has led to an increase in real state prices in my under market value properties.
But, the good news is that because I have been doing this for 15 years and I know how to rehab properties and negotiate investment property deals, I still am able to make excellent returns on flips.
I mostly am a buy and hold investor with owner financing, but I have been doing some extremely profitable flips these days. My work crew loves when I do flips because they pay well, and I like them because they are profitable for me!
I have a current flip that the investor would make $12,000 on, which is fantastic in this hot market. This house is listed below:
Address: 2229 W Hermosa Dr. San Antonio, TX 78201
Year Built: 1948
Description: Under market value property sale in hot north of downtown neighborhood, 2 beds 1 bath, 769 sqft, built: 1948, lot size: .14 acres yearly taxes: $1,200.00, estimated yearly insurance: $800.00, estimated repairs on this distressed sale.
Rehab Option#1: 35K, includes new HVAC, converting to 3 BR, updated kitchen, flooring, paint in/out, exterior skirt, roof, room addition, appliances, paint out door storage exterior, trash, lawn maintenance.
Max After Repair Value: $139,000.00 with owner financing, comps are for 3/1.
Rehab Option #2: 15k AC, flooring paint in and out $109,000 ARV.
Cash Price: $69,900 firm.
This house is located in a hot area north of downtown and is an excellent under market value fixer upper. I was able to get a very reasonable price of $69,900 on this deal.
Of course if I didn’t know what i was doing, this wouldn’t work. Most under market value property investors spend too much on rehab, which kills the deal. I know exactly how much rehab to do on this project – flooring, HVAC, paint in and out, and resell it. By doing that amount of rehab, this will resell for approximately $109,000. Quite a nice flip in this hot San Antonio market!
Try to do this type of flip with San Francisco investment property, Seattle investment property, Los Angeles investment property or San Diego investment property 🙂
Are you a wanna-be real estate investor? Many people do indeed dream of owning under market value rental properties and someday earning positive real estate cash flow from them.
However, before you consider buying under market value investment properties, you really should think about what you are getting into. Being a part time landlord is usually a lot more hassle than many realize.
I am a full time real estate investor in San Antonio investment properties. At one time, I owned more than 100 San Antonio rental properties. I have deal with rental property problems many times and I have since stopped renting out properties and now I make real estate cash flow in another way without maintenance…..
But I am getting ahead of myself! Here are the common issues I’ve seen with rental investment properties:
Repair costs: If you are going to rent out your California investment property or Texas investment property (or wherever it is), you will most likely need to spend a good deal of money to make it ready to rent. Any damage to the roof, plumbing, foundation or electrical systems could cost a lot to repair.
This can especially trip up the part time landlord who has a full time job and has bought rental properties for real estate cash flow. Odds are you are not an expert in rehabs and you could easily overspend on fixing up the house.
Depending on which state you are buying your investment properties, you could have landlord and tenant laws that mandate that you add safety features to the house, such as handrails, peephole in the front door, adding a firewall, and a lot more.
Getting repairs done: As a rental property investor, you are going to have repairs that have to be done fast. Back when I was a landlord 10 years ago, I had water heaters go bad. Sometimes the house got flooded and I had to spend a couple thousand dollars to clean it up. Of course, the after hours plumber can cost you $100 per hour or more.
Collecting your rent: If you are lucky, you will have good tenants who always pay on time. But oftentimes, you have tenants who are late. This is an especially big problem if you buy your rental properties with mortgages. I never buy my under market value properties with mortgages, only cash.
Dealing with pain in the neck tenants: Eventually you are going to have to deal with tenants who damage your house or cause problems with other tenants. I once had a tenant who almost burned the house down. Of course, you will also have to deal with evictions at times, which can be problematic depending upon your state. In some states, the tenant can stay in the house 60 days or more without paying rent!
Keeping the property safe: If you rent out properties, you could be at risk of being sued if someone is injured on your property. You must keep the home maintained so that there are not potential accidents.
The bottom line on rental properties for me is to not invest in rental properties. There is simply too much hassle involved in them to make it worth my time. Been there, done that!
How I Invest in Below Market Value Properties Without Repairs
The way that I invest in San Antonio investment properties today is to buy my under market value property in cash, do $10,000 or so in rehab, and then seller finance it. This type of investing has four big advantages:
I have no mortgage. Yay!
My occupant is buying the house on terms from me. That means they maintain the property and do all of the repairs. Double yay! If they choose to not repair it, that isn’t my problem. I merely hold the note on the house.
I enjoy pure real estate cash flow in my under market value San Antonio properties. No expenses! Is this cool or what?
Because I buy investment property in Texas, foreclosing is very easy. I get the house back in 60 days and resell it again. I have resold the same house three times before: $5000 down, $800 per month.
Of course, this type of real estate investing takes CASH. But if you have an IRA or a 401k, you can often invest in these under market value houses.
Below is a great example of the type of investing my out of state investment property investors and I do.
The house above in on West Poplar Ave. in 78207 in San Antonio. It is a newly completed San Antonio investment property that was bought the the California investor for $44,000 in October 2015.
We conducted $10,000 of rehab on the property and put it on the market in December 2015. Total cost to investor was $54,000. It was resold in late January 2016 with the following terms:
$83,000 sales price
$5000 down
$627.61 per month ($800 per month PITI)
9% interest
30 year note
Total return for out of state property investor is 14% ROI. If you are interested in out of state investment property that earns 10-15% ROI with no maintenance, please contact us.
Below are more rehab pictures:
Based upon this 14% ROI return, I think you can understand why many of my investors from out of state USED to buy San Francisco investment property, San Diego investment property, Seattle investment property, and Los Angeles investment property. Now they mostly buy San Antonio investment property.
As an experienced and successful investor in San Antonio investment property, all I buy and sell are houses that I lovingly refer to as ‘junk houses’ but are excellent San Antonio investment properties.
As I have noted in other case studies, the smart out of state investor needs to look beyond the surface unattractiveness of these under market value properties in San Antonio and see the value and potential for real estate cash flow underneath.
The house above in on West Poplar Ave. in 78207 in San Antonio. It is a newly completed San Antonio investment property that was bought the the California investor for $44,000 in October 2015.
We conducted $10,000 of rehab on the property and put it on the market in December 2015. Total cost to investor was $54,000. It was resold in late January 2016 with the following terms:
$83,000 sales price
$5000 down
$627.61 per month ($800 per month PITI)
9% interest
30 year note
Note that this is a seller finance property, not a rental property.
Total return for out of state property investor is 14% ROI. If you are interested in out of state investment property that earns 10-15% ROI with no maintenance, please contact us.
Below are more rehab pictures:
Based upon this 14% ROI return, I think you can understand why many of my investors from out of state USED to buy San Francisco investment property, San Diego investment property, Seattle investment property, and Los Angeles investment property. Now they mostly buy San Antonio investment property.
Thanks for coming by. Here’s what you need to know about me right now: I’m a financially retired real estate investor in San Antonio TX who is dedicated to transforming the city into all homeowners.
I tell you this not to show off, but to make this point: I am a serious, very accomplished and wealthy investor. I’m not an amateur. So, if I say a house will sell for such and such, or the rehab will cost such and such, you need to believe me and not question me. I do deals in my San Antonio neighborhoods every week, and I know what things cost.
You wouldn’t question your brain surgeon about the type of craniotomy he is going to do on you, right? So please don’t question my expertise on San Antonio investment property.
I know what you may want to ask:
If you’re such a big shot, why are you still working huh?
🙂 The reason is that while I have my own portfolio and am set for life, I still have ambitions and a Mission: I want to transform the entire city of San Antonio TX into home owners.
And to do that, I need serious out of state property investors to buy 10+ under market value houses in the next 10 years. So, I want to keep you happy with high cash flow San Antonio houses that have accurate ARVs, accurate rehab numbers, and quick resale time. It does me no good if you buy 1 deal and are unhappy and leave.
If you are going to do 10+ deals here, I need you to understand a few things about how I work. Whether you are a rookie or an experienced investor, I do things a certain way and want us to be on the same wavelength from the start.
So without further ado……
$50,000 capital required. You need to have capital or the ability to obtain capital to talk to me. $50,000 is a good starter – ideally in a bank account but 401k and IRA money works too. I simply do not have time with my schedule to talk to people with no money. If you do not have capital, that’s fine. Hey, I’ve been there! But I raised money from private investors to get rolling. You need to find private sources of capital at reasonable rates so that you can make monthly cash flow on my deals of $200 to $300, and pay those guys off in 1-2 years.
Reread the above please. This is an advanced investing system in under market value San Antonio properties. IT TAKES CASH. This is not an investing system for the house hacking, 3.5% down rental property investor on Biggerpockets.com who is just starting out.
Zillow values are crap – PLEASE don’t bring them up. Nothing screams ‘clueless amateur’ more than using Zillow property values to evaluate my deals. Honestly, it’s annoying when an out of state investor who knows nothing about San Antonio challenges my ARVs. Look: I have completed nearly 1000 deals involving thousands of houses in San Antonio TX. I have done hundreds of rehabs. If anyone knows the ARVs of these under market value properties, it’s me.
Zillow will always lowball what my houses resell for. If you are going to look up property values in Zillow and challenge my ARVs, please find someone else to work with. It’s amateur hour to question an expert investor about resale values; serious investors understand a 15 year real estate expert in one specific city knows 1000 times more about local ARVs than a freaking national real estate database.
My owner finance deals are off market. My under market value deals are usually sold with owner financing, which means they are off market, which means that Zillow and other public websites are totally worthless for evaluating my deals.
My ARVs are accurate. I didn’t get to where I am in life by overestimating what houses will resell for – to scam you into buying 1 house. If you don’t trust my numbers, try Detroit. We need to trust each other to work together.
10 houses! Remember: My goal is to transform San Antonio entirely into property owners. I do not need you to buy 1 house so I can make a small commission. I need you to buy 10+ under market value deals from me so I can transform this city. That won’t happen if your first deal sells for less than what I stated. BTW, finding a single cash buyer these days is a LOT of work. Does it make sense for us to overestimate a house’s resale value, piss you off, and you walk after 1 lousy deal? Heck no! We want happy investors here that buy long term.
Cash buyer references available for serious buyers. I have many references who are cash buyers in California. I’m happy to provide those references to investors with capital who are serious about investing.
I own a construction company. I do rehabs at 2/3 to 1/2 the price of your typical rehabber, and I do good work. Insured, bonded, all permits included in my price. I do enough to get the house resold and more more than that. This saves you money and boosts ROI. Honestly, I make little money on my rehabs. I am totally dedicated to my Mission and to making you money. So I am willing to sacrifice rehab profits to get you to buy 10+ houses in 10 years.
All deals close with my real estate attorney. I have used West & West Attorney at Law for more than 10 years to close my deals. They know me well. Not a penny of your investing dollars go to me. It all goes through the title company.
Patience on rehab. If you do buy an under market value property from me, I will get it rehabbed ASAP. Usual turnaround is 30-45 days. But stuff happens. The roof could need more work than I thought, or the foundation may need more work, or the weather turns bad and it rains for a week. All of this delays the project. BE PATIENT.
One and done. If you call me twice per day asking me when the house is going to get finished, that will probably be the last deal we do together. No joke – on a work day, my cell phone is clogged with dozens of text messages, a dozen voice mails and 100+ emails. I cannot babysit you. Please, be patient. I will call you and email you as soon as it’s done and will send pictures.
Patience on resale. Once it is rehabbed, I will get it resold ASAP with the MLS and bandit signs. Please do not call every day wondering when it will sell. It’s real estate, not McDonalds. When I have a serious buyer with a contract, I will inform you immediately.
In short, I love working with out of state investors….investors who used to buy California investment property, San Francisco investment property, Seattle investment property and Los Angeles investment property. But please – reread the points above before we talk. This will make our relationship work smoother. Thanks.
As late as 2014, many California investment property firms were buying up dozens of single family homes in Los Angeles, San Francisco and Seattle and then leasing them out.
This was a true flood of cash into California investment property, and helped to push many working families out of the real estate market in California.
But as of 2015, many California investment property companies stopped buying in California, both northern and southern. These investors found that the prices had hit a ceiling and there were no more bargains to be had. In short, there were no more under market value properties; everything was over market value.
Blackstone Group, a major California investment property buyer, cut its purchases of California properties by 90% in 2015. And Oaktree Capital in Los Angeles has been trying to sell off its portfolio of 500 California investment properties.
That is a big changed from 2014, when all buyers of California properties were in bidding wars. The median home price in Los Angeles was a high $385,000, which makes buying properties that produce real estate cash flow a real challenge.
According to Blackstone, prices in California investment properties reached a point where they could not buy a home, rehab it and rent it and make any kind of return.
Among the twenty companies that buy up the most California investment property since 2012, purchases have declined more than 70% in the last year.
One of the places that I see many San Francisco investment property buyers, San Diego investment property buyers and Los Angeles investment property buyers coming is to San Antonio TX. I have several new cash buyers for real estate cash flow so far in 2016.
Here you can buy my under market value houses for $25,000 to $50,000 and make excellent real estate cash flow. Here is a great example.
A Good Example of Under Market Value, Cash Flow Property
This property was sold to my investor for only $25,000:
No one wanted this ‘junk house’ San Antonio investment property. I did! I saw the $100,000 houses next door lived in by the owners, and all of the revitalization going on in this area of San Antonio on the near west side.
Many out of state investment property buyers looking for real estate cash flow would never buy this house. My investor did for $25k, and then I did $27k in rehab:
Electrical update
New flooring (float new floor over that minor foundation issue after it’s repaired)
Clean out
Update bath and kitchen with tile and granite
New light fixtures
Paint in and out
Finish second bedroom
The ARV on this below market value property is $79,900. We just finished the rehab in the middle of January 2016. And guess what? By early February, we already had an owner finance buyer for it: $5000 down, $850 per month, $79,000 final price, 10% interest, 30 year note.
That is what you can do with San Antonio investment property in an under valued market such as San Antonio. Anyone who buys San Francisco investment property or Los Angeles investment property or Seattle investment property will never see these types of returns or prices.
Out of state investment property investors, this San Antonio investment property offers 15% ROI with no repairs after you do the rehab.
Address: 905 Green St, Poth, TX 78147
Year Built: 1956
Description: Excellent cash flow opportunity San Antonio investment property, booming San Antonio Suburb Market, extra clean community, very popular location southeast of San Antonio, 3 beds, 1 bath, 1274 sqft, large lot: .17 acres, estimated repairs: 20K, paint in/out, new HVAC, update plumbing/electrical up to code, flooring.
Max After Repair Value: $89,000.
Cash Price: $39,000 firm.
Exit Strategy: Owner Finance with 20K repairs: 5-10k down, $900.00 monthly P/I, 30 year amortization, 10% interest, Price: 89K; or resell to cash investor after rehab.
Additional Costs: $1500 commission to me on wholesale, $2000 in closing costs, $1500 commission to me on resale, $2000 in closing costs on resale (taken out of $5000 down payment from buyer).
Investors, you will never see a San Francisco investment property, Los Angeles or a Seattle investment property at this price point and rate of return!
Description: Under market value investment property, three bedroom, one bath that has 928 square feet. Beautiful home with TWO exterior storage units – this is a MAJOR selling point for the end buyer; most buyers are blue collar contractors, and they need their tools to be completely secure.
Max After Repair Value: $99,000.
Cash Price: $65,000.
Exit Strategy: Owner finance this out of state investment property with positive cash flow with only $10,000 in repairs completed in 30 days – $99,000, $900 per month, $5000 down, 30 year note, 10% interest. This San Antonio investment property offers passive cash flow with no maintenance.
Alternative Exit Strategy: Buy at $65,000, remodel $15,000, rent $995 per month.
Investors, you will never see a San Francisco investment property, Los Angeles investment property or a Seattle investment property at this price point and rate of return!
I have made my real estate investing career in buying and selling under market value properties in San Antonio TX.
I like to lovingly refer to my properties as ‘junk houses.’ I love that most investors see them as ‘junk’ and run away from them. I have made millions off of ‘junk houses’ that other investors are scared of.
The smart investor just has to look beyond the exterior ugliness and see the potential of the house and the neighborhood.
I just had yet another under market value success story I wanted to share with you. My out of state investment property investor bought this ‘junk’ house for $25,000 in November:
It had sat empty for years and was part of an estate sale. Now this house was ugly, no question about it. But it is located in an up and coming neighborhood in 78207, where the city of San Antonio has spent millions of dollars putting in running trails, parks, shopping plazas, green space and so on. This ‘junk’ house is only 2 miles from downtown and all the tourist attractions of the city.
Yet this under market value house sat for months and no investor wanted it. I grabbed it and quickly resold it to an out of state investment property investor.
Right next door to this ‘junk’ house were these owner occupied homes:
Those houses right next door are worth more than $100,000, but no one wants my under market value ‘junk’ house because it’s temporarily ugly:
The conventional investor wanting real estate cash flow cannot see past the ugliness, but I saw the potential here because of the neighborhood revitalization and the nice houses around it.
So, I sold this house for $25,000 to an out of state investment property investor who did $27,000 in rehab (which I did for him in 30 days), which included:
Electrical update
New flooring (float new floor over that minor foundation issue after it’s repaired)
Clean out
Update bath and kitchen with tile and granite
New light fixtures
Paint in and out
Finish second bedroom
Note that I own a construction company, and my rehabs are typically 2/3 of the price of most companies’ rehabs.
Note that this is a seller financed property, not a rental property.
Below are the after rehab pics of this San Antonio investment property:
The ARV on this below market value property is $79,900. We just finished the rehab in the middle of January 2016. And, by early February, we already had an owner finance buyer for it: $5000 down, $800 per month, $79,000 final price, 10% interest, 30 year note.
The house was on the market for less than a month. So on a $52,000 investment, the out of state property investor will earn about 15% ROI with no more repairs because we owner financed the house.
This is the kind of under market value investing I do – I buy ‘junk’ houses that other investors reject and turn them into little gold mines.
Most of my investors wanting real estate cash flow usually buy Seattle investment property California investment property, San Diego investment property, Los Angeles investment property, or San Francisco investment property, and are shocked at the type of returns you can get here in San Antonio TX with San Antonio investment property – with no repairs!
Many of my out of state property investors come to San Antonio TX from San Francisco. They find it is very difficult to find affordable San Francisco investment property that will produce passive cash flow.
According to Forbes, 2016 is an excellent time to pick up under market value properties for cash flow in many undervalued markets. One of the most undervalued investor markets is San Antonio, which comes in at #6 on their list with a median price of only $189,000. It also is rated as their #4 boom town.
San Antonio is a much more affordable place than San Francisco to buy under market value properties.
San Antonio is where I have bought hundreds of under market value properties since 2000. I have made millions of dollars off of below market value, $50,000 houses that many investors would laugh at.
It’s much easier to make real estate cash flow on investment properties in the undervalued market of San Antonio. It is IMHO one of the best cities to invest in real estate given its growing population, affordable real estate, low taxes, and strong economy.
San Francisco Investment Property Hugely Overvalued = No Cash Flow
Meanwhile, San Francisco houses and San Francisco investment property is among the most overvalued in the US, according to Forbes. That magazine states that five of the most overvalued investment property markets are in California: San Francisco, San Diego, San Jose, and Los Angeles.
What is driving the lack of affordable investment property in San Francisco? There simply is not enough supply of market value properties for home buyers, which means that California investment property is just too expensive to produce real estate cash flow.
One of the reasons for that, Forbes says, is that many Chinese buyers have come into San Francisco and bought up San Francisco investment properties, paying full cash offers.
Another source says that San Francisco price to rent and price to income ratios have gone up by 25% from 2012 until 2015. The median price for a San Francisco house is $548,000 and is up 24% from a year ago.
In fact, San Francisco investment property houses are getting near to levels that were during the bubble years of 2006 and 2007. That was when prices in San Francisco were near $665,000.
I do not know how San Francisco investment property buyers can survive in that market, or California investment property generally. If you buy for appreciation, maybe you can do well, but that is far too risky for me.
I am an under market value, buy and hold, real estate cash flow investor.
A Good Example of Under Market Value, Cash Flow Property
Like I said earlier, I buy and sell under market value properties that many wealthy investors laugh at.
For example, this below market value San Antonio investment property was sold to my investor for only $25,000:
No one wanted this ‘junk house.’ I did! I saw the $100,000 houses next door lived in by the owners, and all of the revitalization going on in this area of San Antonio on the near west side.
Many out of state investment property buyers looking for real estate cash flow would never buy this house. My investor did for $25k, and then I did $27k in rehab:
Electrical update
New flooring (float new floor over that minor foundation issue after it’s repaired)
Clean out
Update bath and kitchen with tile and granite
New light fixtures
Paint in and out
Finish second bedroom
The ARV on this below market value property is $79,900. We just finished the rehab in the middle of January 2016. And guess what? By early February, we already had an owner finance buyer for it: $5000 down, $850 per month, $79,000 final price, 10% interest, 30 year note.
That is what you can do with investment properties in an under valued market here with San Antonio investment property. Anyone who buys San Francisco investment property or Los Angeles investment property or Seattle investment property will never see these types of returns or prices.
