90414 In the Home Training #1

SavingThe PlanetOne HouseAt A Time

G r e e n E a r t h E q u i t i e s . C o m

Welcome to PlanetSavers University. Take a look around

while the class is gathering. Would you buy this house?

Why or Why Not?(Distance Learners see the next 20 slides)

1Tuesday, April 14, 2009



Construction Sign & Real Estate Sign better than

either alone2Tuesday, April 14, 2009



We buy Ugly Houses3Tuesday, April 14, 2009



The more vandalism, The better (the price)




Not too smart taggerBurt couldn’t say much in court




Jennifer says “The fireplace has to go”




Garage “Before” Notice the different feel in the completed garage




We love ugly houses!8Tuesday, April 14, 2009



Deferred Maintenance9




Most Investors hate all pools, especially green ones

= Opportunity10Tuesday, April 14, 2009



Pool Cleaned Up Nice Patio Cover for Outside Living




Former Front Porch Project




Kitchen in process13Tuesday, April 14, 2009



Rye Grass works wondersFireplace is still in there...




More Vandalism and Rookie Remodeling




Wannabe Remodelers

Many of our best buys have been the home where the owners

giftings have been in other areas besides using tools.

But they gave it a go... And really messed things up.

Stuff like this scares many investors




Unique Use of Small Space

Wow! Features seen only in custom homes help buyers justify the total investment

(including the Energy Package.)




Small but Classy

Built in Shower Shelves and accent tiles are a signature feature that buyers love.

Extra cost is minimal after you know how to do it.




Crown and Base Look for the joints




Same granite and tile accent throughout




Blinds installed is part of the “Done Package”




Almost Finished. Warm light is from colored glass tiles




The Time Is Now There has never been a better time to invest in Real Estate. We have the inventory, the experience, the financing to buy, the financing to sell, the contractors, and the pent up demand of buyers. The only thing

that could prevent our success would be our failure to act.

The main thing that would cause that would be listening to mainstream media and negative friends.

DONT DO IT!




The Perfect Storm of Opportunity

• Massive amount of inventory (cheap-REO)

• Lowest Interest Rates in Years

• Rents are Staying High

• Craftsmen and Contractors are hungry

• First Time Buyers Incentives.

• Banks MUST sell.




Green, or Energy Wise?What’s the difference?• The public is interested in Green first, and

Energy second

• We are interested in Energy first and Green second

• Usually you dont have to choose. But if we had to, we would choose Energy wise.

• Example: A “less green” sealant that seals better than its greener counterpart




Green is Sexy and Cool So Lead with Green, but Deliver Energy

• Purpose for our name GreenEarthEquities

• Suggest you do similar.

• Use it in blogging and sites... Rise in Google

• People dont really understand it.

• Bullet points are more powerful than stats

• “Our carpet is made of recycled Pepsi bottles”




Why Be An Energy Wise House Flipper?

• Make some money

• Build and Preserve a Lifestyle

• Save the Planet

• Bless your Community

• Feel good at the end of the day

• All of the above




In the 21st century, Travel

Agents and Energy Wise

House Flippers can work

anywhere on the planet.




Standard Advice of Realtors & Experts

• It’s not a flipping market

• It will never sell if you do all that stuff

• Carpet, Paint, Rent, Hold, & Hope, that’s the way

• After Vacancies and Repairs, Hope for Zero

• Let’s take a look:




Problems with the Standard Model

• Depends on rapid recovery???

• Market must regain most or all of its loss???

• Even with management, You’re still a landlord. Do you want those headaches???

• It does nothing (good) for the neighborhood.

• It does nothing (good) for the planet.

• If it’s not good, What is it?




Dave RobinsonPrincipal

GreenEarthEquities.Com

Energy Wise RenovationSmart Energy = Smart Equity, Wow!

The Right Neighborhood: Clovis Schools. Established neighborhood with tree lined streets. Close to Sierra Vista Mall, Old Town Clovis, Bus Lines,Shopping & Parks. 244 employers and over 10,000 jobs are within a 2.5 miles radius.

*$185,000 @, 30yr. 6% fixed rate, $10,000 down. Includes principal & interest only, taxes andinsurance not included. Other down payments or terms will require different payments. Qualifications depend on lender guidelines. Not all people qualify.

Estimated total payment with taxes and insurance should be less than $1350 per month.

Why Rent? Buyers can own this Tarpey Village

home in Clovis for $1,050 per month*

About GreenEarthEquities

& SmartEnergyHomes GreenEarthEquities we

acquire distressed properties in prime neighborhoods and

renovate them with 3 goals in mind: The Energy Factor , The

Wow! Factor, and It’s All Done! Buyers enjoy lower utility bills and more comfort, every month in their Low

Maintenance SmartEnergyHome.TM

3 Bedroom, 2 Bath 1574 sq ft.Living and Family RoomsBuilt 1959, Re Built 2009

See reverse for complete details.

Thank you for visiting

5741 E Bernadine

For more information:Recorded 800 219 1042 ext 10

Or Jennifer Martin 259 8153

Our First Open House Flyer page 1This brochure was given to the “Preferred Group” of Realtors. They used it to promote and sell the

next two projects as well as this one.




GreenEarthEquities.Com5741 E Bernadine

At GreenEarthEquities all we do is Energy Wise Renovation of homes. Each item that goes into our homes must address

one of these three objectives:

! 1. "Energy Efficiency

! 2. "Wow! Factor

! 3. "Easy Living Factor

This is what we chose to do to meet those objectives on this home:

Energy Efficiency

1. "All new dual pane windows. ""

2. "Big west window is Low E 140 (nearly twice the resistance to Solar Heat Gain as LoE2)

3. "Deciduous tree will be properly selected and planted to aid summer shading.

4. "Ductwork has been re-engineered and tightly sealed.

5. "Choice of Cooling Systems. " " Evaporative system may be used in May, June, Sept, Oct

6. "Shell Sealing of cracks and holes under the floor and in the attic at the ceiling level.

7. "Attic insulation to R-50+ : far above Energy Star Standards for brand new homes.

8. "Wall Insulation with dry packed cellulose. "The subdivision originally had no wall insulation.

9. "Gas stove and gas option for the dryer. " Electric is available at both locations also.

10. "Dual pane and foam core front entry door

11. "Upgraded ceiling fans in every room

12. "Buyer will"receive"50% of their utility bill paid by seller for TWO years. (we stand behind our energy improvements)

Wow! Factor

1. "New cabinet door and drawer treatment. "Custom designer finish not available at box stores

2. "Matching Tile floors and counters

3. "New Hood Fan Microwave

4. "New Gas Stove and Oven

5. "New Dishwasher"

6. "New Disposal

7. "New Deep Cast Iron Sink with premium faucet and spray

8. "Matching tile at Bathroom Floors and Showers

9. "Designer 2 and three tone painted interior

10. "Crown molding and chair rail

11. "Designer 3 tone paint exterior

12. "All ceilings have been scraped and replaced with new designer texture and paint

Easy Living Factor ! (Ready to move in with minimum work and maintenance for a LONG time)

1. "New front and back lawn

2. "Automatic sprinklers front and back

3. "Automatic drip system at beds

4. "New gutters

5. "Recently replaced 30 year roof

6. "New Roll Up Garage Door with new automatic opener

7. "Recently replaced water heater

8. "Recently replaced Air Conditioner and Furnace

9. "New receptacles, new switches and covers

10. "New six panel doors and new hardware.

11. "New light fixtures

12. "New faux wood blinds.

13. "Additional return duct in master suite so the comfort system continues to work with the door closed."

14. "Newer carpet 3 grades up from FHA standard, normal in renovation, with 6 lb pad. (4 lb is normal)

15. "Recent major tree trimming - wont "need to be redone for a long time.

16. "Sewer line recently serviced and encroaching tree roots removed.

We value your opinion. How do you think we did toward meeting our objectives?

What would be one or two things that you would change to make this home more desirable?

Thank You

Dave Robinson, Ben Carroll, Jennifer Martin

Page 23 Packages

Energy PackageWow! PackageDone Package

Next version of this will have generic

package page like this, Only page one will

change




GreenEarthEquities.Com Projects in the Pipeline

To meet our objective of turning 50 homes per year, we must renovate and sell rapidly. We plan that many homes will be sold before they reach MLS. All homes will be offered to the group of Preferred Realtors for 7-14 days before listing in MLS. For details and to be alerted of new projects as they become available contact Jennifer Martin 259 8153

Because all of our homes will be done in less than the 90 day FHA minimum hold time, we will consider “Owner Financing” and are securing a funding vehicle to support those transactions. Bring your creativity and your good buyers who cant qualify for FHA. Contact Jennifer for details.

Address Details Price Completion Target

#15741 E Bernadine

1574 sf 3-2 LR & Fam 1959Corner Lot, RV access, GreenEarth Energy Package, Custom Kitchen, New Appliances, Landscaped Auto sprinklers F&R

$185,000Ready Now

#25664 E Bernadine

1404 sf 3-2 LR & Fam 1962 poolGreenEarth Energy Package, Custom Kitchen, New Appliances, Landscaped Auto sprinklers F&R

$179,000 Feb 20, 2009

#33328 N Purdue

1164 sf 4-2 GreenEarth Energy Package, New Cabinets, New Appliances, Landscaped Auto sprinklers F&R

$138,500 Feb 10, 2009

#43332 N Ezie

1362 3-2 LR & Fam 1960 Possible RV GreenEarth Energy Package, Custom Kitchen, New Appliances, Landscaped Auto sprinklers F&R

$135,000 -$145,000

Mar 15, 2009

Notes for Realtors:

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Page 3Other

Projects

Other Projects are listed with basic details. Maps show close

proximity of all projects.

Invite to Realtors was accepted enthusiastically




Benefits of Energy Wise House Flipping

• Works even if economy doesn’t recover!

• Works even better if it does recover.

• No Landlord headaches

• Cash a check every 120 days

• Do a good thing for the neighborhood and the planet.




Reasons that this works Now, in these times

• Many foreclosures are available at 25-35% of 2006 prices

• 40 to 50% of todays fixed up ARV prices

• Enough room to make a profit

• We are adding Value. In America Value Added is rewarded with profit

• No one else is doing it (this way) so our unique and desirable product has little competition




This Unique Time Wont Last

• Most of the ARM’s have already re-set

• Another “wave” or two are still coming

• Obama may force banks to modify loans

• A creative person will always figure a way

• But the factors are so perfect for this opportunity, it makes NOW the time to act.




Disclaimer: No One Said This Is Easy

• The System Is The Solution

• Eat the Elephant, One bite at a time!

• Many things (not all) must be done right.

• That’s what checklists are for

• That’s what this and other training is for

• Systems make it Simpler, but not easy.




The System IsA Cookie Cutter

• If we perfect and stick with the System

• We will Stamp Out the Dough!

• Stay away from Architectural Wonders

• Stay away from Historical Homes

• Stay in the Blue to stay in the Green

• Control Your costs. Avoid hourly labor!




The 5 Olympic Rings of Energy Wise Renovation

• Buy It Right

• Design It Right

• Build It Right

• Market It Right

• Sell It Right

• Pass thru all these rings and receive the Gold!




Local or Long Distance?

• Local is easier to manage

• Option of Sweat Equity, doing some work.

• Easier to do Energy Wise Renovation

• Harder to make profits (in expensive areas)

• Best place to start in many areas of US

• Not Marin, Los Angeles, San Diego, etc.




Local or Long Distance? #2

• AFTER you have a good team in place

• Long Distance will earn more profit easier

• Harder to Save the Planet at a distance

• Local is harder work, but easier to control

• Do Local to bless your community

• Do some long distance to diversify.




Local or Long Distance?

• Some of the best Foreclosure Markets

• Indianapolis, Kansas City, Atlanta, Houston,

• Las Vegas, Charlotte, Dallas, Houston,

• Denver, ..................

• Why is Indy better than Akron?

• Choose a place people want to live

• Not Detroit, for example




SFR or Multi-Unit or Mobile Home?

• Single Family is most common entry point

• Mobile Home is the least expensive. May be the place to start on lowest budget.

• Multi Unit, recommended for veterans




Use a Broker, or DIY?

• For small operation:

• DIY and save money & sweat equity

• For a freer lifestyle and bigger operation:

• Use a Broker

• (Not just any broker)




Common Wisdom

• There are Buying Realtors and Selling Realtors

• Probably mostly true

• You can access several Selling Realtors thru your “Preferred Group” system

• A rare pro may be able to do it all well




More Choices,Which Realtor?

• 1. Work directly with REO listing agent?

• 2. Use your Buyer’s agent to present the offers to the REO listing agent?

• Lazy and Busy people prefer #2

• (Make sure you find a good Buyers Agent)

• It’s more work, but #1 has advantages too




Wholesaling

• Find a great bargain

• Tie it up with as long an escrow as possible

• Mention a partner to be named in escrow

• Do due diligence & estimating to add value

• Assign the deal and collect the difference

• Concurrent or same day closing AM & PM




Wholesaling #2• Not the subject of this class

• Many books and courses on the subject

• Can get started with little or no cash

• Cash flow, Who couldn’t use $5K? / month

• Note: Banks dont like it.

• Note 2: Many Realtors say it cant be done

• Note 3: Many investors are doing it daily




Nobody Minds If You Beat Up The Bank!

• No one likes smashing the dreams of retired people and single moms.

• You dont have to. The bank’s done that already.

• The Bank is over a barrel. They have to sell

• If ratios exceed ‘X’, they cease being a bank

• Dont feel bad if it feels good.




Who do you want to be in this business?

• The Carpet and Paint & Make it a Rental guy,

• OR

• The Energy Wise Renovator delivering The American Dream to a First Time Homeowner

• Who would you prefer to be?

• Who would you prefer buys that house on your street?




Who do you want to be in this business? #2• Homeownership improves the neighborhood

• And decreases our reliance on Saudi oil.

• Rentals speed a neighborhood’s decline

• Have you ever washed a rental car?

• Renting is our Exit Strategy of Last Resort

• (After Re-finance, of course)




Picking an AreaAnd Specializing

• You will know the area best.

• Save fuel, save time, save $ (very green)

• You will start to build your own comps

• After #1, All properties will appraise

• You are improving the community

• The neighbors will love you.




How to Choose Your Neighborhood

• Keep it Blue to Stay in the Green

• Buy at 33 - 60% of the Median Home Price

• Sell at 80 - 130% of Median Home Price

• basis = Fresno Median $145,000 (Mar, 09)

• First Time Buyers in this range are plentiful

• Facilitate the American Dream




Hot Mapping Old School

• Big Honkin’ Wall Map and Colored Pins

• Super Visual Aid, not portable

• See Are You Dumb Enough To Be Rich? by Bill Barnett for details




Heat Maps, Digital

• Trulia, HotPads,

• LocaleTrends (best detail, more control) still not as detailed as Big Honker Map and Colored Pins,

• Recommend Ranges 75-100, 100-125, 125-150, 150-175, 175-200, 200-250

• Asking Prices are easier to get and OK for this purpose




Localetrends.com, Tarpey-Melody ParkProblem: The Color Bands are too wide




Fresno Zoomed OutThere’s lots of Yellow and Red




Paychecks or Profits

• For some, It’s time for a Paradigm Shift

• Work for Paycheck, Stay Limited

• Work for Profits, Remove all Limits

• Paychecks used to have safety nets

• Work for profits = No guarantees.




Should I Become a Realtor?

• Probably a good idea, If you are:

• Detail oriented and like structure

• You’ll make money both ways, just disclose

• For non-paperwork people, hire a realtor (most recent deal had 43 pages just to buy) remember 10 to 20 offers per deal....

• Let a good realtor do what they do best. (DJR preference)




Internet Real Estate Sites (starter set)

• CyberHomes.Com

• Maps.Live.Com

• GoogleEarth.com

• HotPads.com , Trulia.Com, Localetrends.com

• RentoMeter.com

• Ocwen.com

• biggerpockets.com/bank-reo.html60Tuesday, April 14, 2009



CyberHomes.com61Tuesday, April 14, 2009



Further down the page62Tuesday, April 14, 2009



Does the math for you!

Select Comps:Similar sq ft

Similar lot sizeRecent

< 3 monthsYou know theNeighborhood




Google Earth

Type in Street

Address and Zip

only




Click Nearest Camera

Three GEEHomes.

Keep ‘emClose.

Save GasSave TimeControl

the comps




Zoom In & march down the street




Formula for Purchase Price

• ARV = After Repair Value

• MAO = Maximum Allowable Offer

• MAO = ARV * .65 - Repairs - Soft Costs

• Note: This is Maximum. Offer less to leave room to dance.




Ways to Offer

• MAO formula - 10 or 20%

• Asking price - 40% (for volume offers)

• Look at property after dance begins (due diligence)

• Remember this is just the first step.

• As much as 100% of the profit comes in the dance of negotiation




Your Digital Signature

• PDFPen for Mac (DJR uses)

• ________ for Windows (you dont need full Adobe Acrobat)

• transparent signatures and initials

• Demonstration




Make A Lot of Offers

• 10 to 20 offers to get a sale is average

• Fewer offers, you may be paying too much.

• Keep going back and refreshing your offer

• Patience is a virtue

• Dont ever “need” a deal

• Dont get emotionally attached to a deal




You only need one Contingency Clause

• Inspection clause is all you need.

• More contingencies weaken the offer.

• If you want more, require approval of your partner. It sounds reasonable.

• A cash offer with no contingencies, not even inspections, is a strong offer and may be accepted at a low price. (do this only if you or your agent have inspected and you are very confident)




Cash is a Strong Offer

• Sellers will prefer a cash offer above one contingent on financing, even at a lower sales price

• Gather your Cash before going shopping.

• The Cash only needs to be there by close of escrow.




Where to find the money?

• Small Local Banks (djr favorite)

• Private Money

• Credit Cards (see biggerpockets website)

• Hard Money

• IRA, 401K, yours or someone elses.

• Need special custodian for IRA that will allow this.




Exit Strategies, Decide before you offer

• Retail Flip after Renovation. Is FHA the new Sub Prime?

• Wholesale Flip (Assignment)

• BRRR Buy, Rehab, Rent, Refinance

• Buy and Hold (rent)

• RTO Rent to Own, Lease Option

• Owner Finance to open a new pool of buyers.




Houses to Stay Away From, or discount Big• Busy Street

• Commercial, Industrial next door

• Two Bedrooms

• One Bathroom

• Unusable floor plan

• War Zones,




Houses to Stay Away From, or discount Big• Very small houses, under 900 sq ft.

• Master Bedroom should be 12 x 12

• No garage, No off street is even worse

• High tension power lines

• Projects, Train Tracks, Freeway

• Functionally Obsolete, Bad Floor Plans




Easy Long Distance Investing

• 360 Realty Indianapolis

• Tom Michalic, Broker, Contractor, Property Manager (Educational Website check it out)

• RTOIndiana.com

• Credit Repair and Stretch Out Down Payment Concepts

• Bring the American Dream to those who B of A and Wells Fargo will say no to




Float Like a ButterflySting Like a Bee

• In and Out Quickly is the Safe Way to flip houses

• In and Out before the market changes radically

• 120 days from Own It to Sold It. (COE to COE) is a reasonable target.

• Turn the money. Do another one. 3 times a year. At least 2




Overcoming Inertia

• Build The Plane In Flight

• Ready, Fire, Aim! vs The Paralysis of Analysis

• The moving car is easier to steer.

• Make an offer, it wont kill you. Get used to it.

• Accept an offer, you still have an out if you need it.




Interview a Realtor• Most Realtors dont like to offer 10 - 20

times to get a sale

• Most Realtors dont like REO’s Find one that does.

• Digitally accomplished. Otherwise you will wear them and you out signing papers.

• Do you own investment property yourself?

• How do you feel about making really low offers?




I dont know if it’s hit bottom yet...

• Of course it hasn’t.

• That’s why quick turn is essential

• While others wait, deposit $10-$20K every 120 days.

• Keep on depositing $10-20 as prices rise.




Hamburger helps dogs like eating their pills...• You wont sell much green or energy

efficiency by itself. Ask me how I know that

• Public is starting to like the Green idea

• But not enough to pay what it costs

• General public has never been willing to pay for energy efficiency without incentives

• The Wow! Factor & good fundamentals allow us to install Green and get paid for it.




GEE Sales Strategy• Two Signs, Construction is Unlimited

• Select group previews the homes

• Brochure shows the others in process

• Others sell before completion. If not sold in 30 days we would move to Plan B and ensure a rapid sale. Owner finance or Lease Option - Rent to Own

• Holding finished property is a bad idea




GEE Sales Strategy #2

• Provide a unique product

• They have never seen anything like it.

• Then there really is no competition




Compete with the Cheap New Homes

• Two column comparison sheet

• Remember the $50,000+ options package It’s in the model but not the base price.

• New home features: No Grass, No blinds, No Trees, Construction noise, and Dirt!




GEE Buying Strategy

• Choose the area

• Offer, offer... Dont get emotionally involved

• Do your due diligence inspections

• Home, Termite, & Sewer are minimum

• Request the Haircut

• Be prepared to walk away




GEE Buying Strategy #2

• Know your costs before you buy (finalize)

• Know your final selling price

• Have your exit strategies before buying

• Use escrow time to get totally ready

• Flurry of activity on day #1, then keep it up




Best Days to Buy

• The First Day or the Last Day

• First Day on the market

• Or a long time, 170 to 450 days

• It may take a bank that long to face reality




How to read the ads and the listings

• Key phrases we are looking for

• Fixer Upper, Needs a little TLC,

• Handyman Special, Bank Owned,

• Corporate owned, Permits unknown,

• Investor Special, Needs work,

• Good Bones




Key phrases we aren’t looking for

• Just Remodeled

• Picture perfect

• Beautiful

• Well kept

• Recently updated




We are looking for Ugly Houses

• The ones no one else wants

• Too much work for them

• They cant visualize the end result

• There is less competition

• More room for profit

• If you have the right team




How Ugly?

• Board Ups & Broken windows

• Burn Outs

• Graffitti and other vandalism

• Cant find the house for the weeds

• Green Pools, Dry & Boarded over pools

• Roof Leaks, & Mold




How much is this photo worth?




Different Strokes for Different Folks!




Wannabe and Rookie

Remodelers create great

opportunities for good deals! Ugly, but easy

to fix.95Tuesday, April 14, 2009



Ugly Good Deals #2

• Unpermitted addition or remodeling

• Garage conversions

• Unfinished projects

• Home Improvement projects by rookies

• Pools of any kind reduce the # of buyers (liability issues)

• The Ugly house on the Average Street




Watch Out ForThe War Zones

• Graffitti

• Tennis shoes over the wires

• Lots of Burglar Bars

• City website will detail crimes per 1000

• Talk to a cop




Graffitti is easy to fix. But will it come right back? Reason we did

not buy this one: No off street

parking & we all got tickets at the

job walk.98Tuesday, April 14, 2009



Who’s On Your Team?

• Realtor

• Banker

• Insurance Agent

• Loan Broker

• Escrow Officer

• Inspectors, Termite, Sewer, Home




Who’s On Your Team? #2

• Subcontractors, HVAC, Electrical, Plumbing, Roofing, Windows, Patio Cover, Flooring, Tile, Granite, Pool, Masonry, Concrete, Locksmith, Dumpster Company, ReStore,

• General Contractor to coordinate all the subs and get all the rest of the work done (with his labor, not yours)




Who’s On Your Team? #3

• Home Depot & Lowes will discount. You have to ask.

• You must beat HD & Lowe’s pricing to prosper. You have to look but you can do it.




To play on our team we need 2 things:

• Wholesale Pricing

• Most Vendors are happy to provide better pricing if they know they are going to receive continuous business.

• Velocity, speed, timeliness, punctuality

• Done right the first time, all the way

• Little supervision required.




Bibliography

• Residential Energy, By John Krigger

• No Regrets Remodeling, By the editors of Home Energy

• Complete Home Improvement, Black & Decker

• Are You Dumb Enough to be Rich? By Bill Barnett

• Flip, By Villani & Davis




We’re Saving the Planet,

One House at a Time!Welcome

To the Adventure


90414 In the Home Training #1

Documents

Transcript of 90414 In the Home Training #1