On this episode of House Flip Masters Holly is joined by guest Sharon Houseworth. Sharon has been a real estate investor for just a couple of years which is exciting because she is newer and also successful at what she does.
Before Sharon jumped into real estate she was in a couple industries. She worked with her mother who worked as a life and health agent - Sharon admits that this really wasn’t her thing. After that she went into the administrative field most recently a construction company which always had her interest. All of these jobs led her to property management and fixing and flipping.
When Sharon when was doing property management she says that she was kind of just thrown into it. Her family had always had rentals and when her mom got older she helped her to manage those properties. In 2009, her uncle passed away and Sharon inherited the 34 units that he owned and became the property manager for those properties. While she isn’t a licensed property manager she was still able to manage her own properties legally. Holly asks Sharon how much time these properties took for her to manage each week - 30 hours is what Sharon was working when she was managing these properties. She found that she had a lot of work because the properties had a lot of deferred renovations that she had to take care of and get up to date and up to code to make sure that she was protected as well as her tenants. Sharon until recently was managing these properties on her own, calling maintenance when things needed to be fixed and collecting rent from the tenants. Sharon recently turned over her property management to a licensed property manager so that she could free up her time. Sharon says that all of her time as a property management has taught her a lot but decided that she needed to move forward and do something different.
After the passing of her mother Sharon recalls hearing a commercial on the radio about learning going to a seminar to learn to fix and flip so she decided to do it. Sharon says that learning to fix and flip has been completely life changing for her.
Holly asks Sharon to share with listeners how she found a deal in Fallbrook that coincidentally ended up being on the same street as a flip that Holly was working on. Holly asks Sharon to share her insight on this deal, as well as her need to adapt to certain elements of this specific deal. Sharon found this deal by getting involved in an investment club for women after completing a 60-day challenge that they offered. From that challenge came this deal, Sharon was called by a realtor about this deal - this property that she was tipped off on was that this property was going to go to auction in 3 weeks. Sharon says that one of the biggest thing that she’s learned is that people come before profit and she was so happy to do this deal because she was able to help the man this man by keeping a foreclosure off his record, his house out of auction, as well as giving him $40,000 in his pocket at the end of the day. Sharon called some investors who might be interested in investing as well as investing in this area which is a little off the beaten path. Sharon cashed out an annuity as well as had a hard money lender who was willing to take a chance on her with her first deal. Sharon decided that she wanted to do this deal with her own money so that if she made a mistake, she would rather do it with her own money. Holly reminds Sharon and listeners that there is no such things as win or lose when it comes to a deal it is win or learn because you don’t know what you don’t know and the only way you will learn is by making those mistakes and that each realtor has bumps in the road and for those bumps they are made smarter. With this property Sharon needed to extend on it twice and was only charged 1 point on the second extension. Holly reminds listeners that there is always a charge for an extension. Sharon owned this property for close to a year when she deiced to refinance the house with another hard money loan which helped to bring down the interest rates as well as the payments to the home. After she got the reinforce Sharon knew that she had to get a tenant into the property - wanting to utilize all free services available to her she put an ad on Craigslist and got responses within hours. The person who contacted her was a realtor who wanted to be closer to work and they were a right fit for Sharon and they are still living in the home now.
Three weeks after these tenants moved in to this property Sharon experienced some maintenance issues. The tenants woke up to the whole downstairs covered in 2 inches of water that appeared to be coming from under the kitchen sink. The day of this disaster also happened to be on the day of the tenants daughter’s wedding - but Sharon laughs and reminds us that it can always be worse. Because of this leak the tenants were displaced from the home for almost 2 months. Sharon reminds us that it is vitally important that you require renters to have renters insurance so that their items and lifestyles are protected if something should go wrong. Because Sharon also had the proper insurance she was also covered on her end and was able to not worry about loss of rent because the insurance covered that for her - insurance also paid for all the damage incurred from that loss. Holly reminds us that is is important to get your insurance in place and make sure that you get the right insurance in place.
As if this property didn’t have enough going on it is as of late that the neighbor uses her property as an Airbnb and the current tenants do not care for it because the guests can often be loud and there are always people coming and going. Once the lease is up there is a business that is interested in renting Sharon’s property which is an entirely different realm of investing for Sharon that she is excited to learn about. The moral of Sharon’s story is to not panic if your first plan does not work because there is always another path that you can take that property down.
Holly asks Sharon what advice she would give to someone new and starting out. Sharon says to keep moving forward every day and to be committed to this business even if you cannot do this full time always have investing as your end goal because there is a lot of money to made and a lot of people to be made. Sharon says that investing is a team sport and she has met so many fabulous people who are always willing to help her along the way.