Flip This vs. Flip That

The Prey: Uninformed everyday people trying to get rich quick. ____

The Bait: Infomercials and Reality Shows showing huge profits too good to be true.

The Catch: It’s easy for a flip to become a very expensive flop

Stop letting these vultures prey on you with promises of riches. PAY ATTENTION & PASS THIS ON: REAL ESTATE INVESTING IS NOT AS EASY AS THEY MAKE IT LOOK! AS A MATTER OF FACT, MOST OF WHAT YOU SEE IS NOT EVEN REALLY WHAT IT IS! ____

Every where you look, someone is trying to sell a bill of goods to you about how easy it is to find a property, fix it up and get rich quick. Two popular shows come to mind. A&E's, Flip This House program really dug into problems with contractors, negotiating prices, and time crunches. TLC’s Flip That House follows the transformation of a different house, each with its own "flipper/host" with step-by-step renovation from the initial purchase to plans for giving it the necessary "facelift" to re-sell.____

Flip This was a one hour show vs. Flip That being 30 minutes -- the differences between the two programs are very subtle. At the end of each of the shows episode the results of the house-flipping exercise is revealed, along with a new sales price to re-sell showing a huge profit.____

These shows romanticize the act of rehabbing properties and selling them for profit. The reality of this reality is that it’s not as easy as they make it sound, even for a seasoned investor. What they don’t show is how easy a flip can become a flop! ____

On an episode of A&E's popular reality series Flip This House, Sam Leccima, a self proclaimed successful Atlanta real estate investor sits in front of a run-down house and calls buying and selling real estate his passion.____

Flip This House depicted him buying, refurbishing and reselling several Atlanta-area homes for profits of $77,000 and more. But Leccima, who is currently under investigation by the Georgia Secretary of State's office for securities fraud, is nothing more than the latest scam artist caught preying on victims with promises of easy riches. His real estate license was revoked by the Georgia Real Estate Commission in 2005, citing that Leccima "does not bear a good reputation for honesty, trustworthiness, integrity, and competence." ____

It appears Leccima's true passion was a series of elaborate hoaxes and scams that included faking the home renovations shown on the cable TV show and claiming to have sold houses he never even owned.____

His friends and family were presented as potential homebuyers and "SOLD" signs were slapped in front of unsold houses. The home repairs - the lynchpin of the show - were actually temporary patch jobs designed to look good on camera. One scammed Investor attended what was billed as a wrap party at one of Leccima’s homes. But when A&E Television Networks aired the party on Flip This House, it was presented as an open house at where a buyer expressed interest in buying the property. Sound familiar? How many times have we seen this on shows!____

While not acknowledging his televised renovations were staged, Leccima didn't deny it. Even though Leccima suggested that A&E and Departure Films, the production company that makes the show, knew exactly what he was doing, they got busy denying any knowledge of wrongdoing. The cable network pulled reruns of Leccima episodes off the air and wiped his mentions from its Web site when they learned of the claims against him. "We are dismayed to learn of these allegations," read a statement issued by the network. "A&E Television Networks is not a party to any of the transactions shown in Flip This House and has not received any formal complaints about the properties or sales."____

"Ask anybody who works in television how a reality show is made and you'll find that ours was a very typical approach," Leccima said in a telephone interview. ____

Atlanta FOX 5 has this footage.

Video Killed The Blog

Value Range Marketing - How it Works

The summer season is the time when more homeowners list their property for sale and more homebuyers purchase than any other time in the year. As these homeowners prepare their home to sell in the coming months, one question will rise above the rest: where should our home be priced?
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That's where value range marketing comes in! Instead of listing the home at a fixed price, the seller allows the buyers to see the range that they would be willing to sell into. This would allow people to see the home who might normally miss it because it would otherwise be out of their price range. For example: A value range property that is priced between $500,000-$550,000 will show up in a search of a buyer who searches between $475,000-$520,000. If a the seller prices their home at a fixed price at $535,000, the property would not come up in the buyers search. As more buyers view and preview the value range properties, the added attention will generate more exposure to that property in comparison to comparable fixed priced listings.
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It is likely you have seen a home using the value range price strategy. The technique calls for a property to be sold using a low and a high price, while the seller entertains offers between the range. The process encourages open negotiations with a seller who will come down in price and a buyer who will go up. In order to create the range, instead of including your appliances and other extras with the sale you can sell them elsewhere which would enable you to lower the overall price of the property.
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The additional exposure has the potential to generate more offers and since competing buyers legally cannot know the price of competing offers, the presence of an offer, even a low one, may act as the catalyst in achieving a price above the prevailing rate. The Seller benefits by generating offers he may not have received due to the limitations of fixed pricing.

Niche And Grow Rich . . . Or So They Thought!

May 30, 2007 ·

We all know there are far too many real estate agents in Southern California! So how do you gain an advantage in a saturated market? Marketing 101 teaches us that it’s a smart idea to specialize in a specific niche to gain more business. However, when choosing to specialize, selecting to serve a niche that will use the house for criminal enterprise may not be the wisest long term career move.

I’m sure we all heard about the Stockton California Police finding a string of grow-ops homes, (homes that had been converted to indoor pot farms). Like all good investigators, the police looked for commonality that linked the houses. Bingo they found one! All of the homes had been purchased by a buyer who used the services of two enterprising real estate agents inpurchasing a total of 41 grow-ops throughout San Joaquin and Sacramento counties. These are real estate agents who found their niche and stuck with it!

Those same type indoor grow-ops are now magically appearing all over the western half of the Inland Valley. The Diamond Bar Neighborhood Watch is one among many neighborhoods that have revived its crime-watch program after police raided several local homes in our region.

A sophisticated cultivation system was installed in this local Inland Valley home that included 70 1000-watt sun lamps, 70 power box converters, 12 industrial sized air purifiers, 35 wall fans, and over 200 gallons of liquid fertilizer. Installed throughout the entire house was a drip irrigation and water recycling system

Keep a Watchful Eye

Neighbors keep a watchful eye out for suspicious activity that could indicate that other grow operations are hidden behind closed doors in a home near you. According to Los Angeles County sheriff Lt. Jim Whitten here are some signs to watch for:

• Windows are always shut.
• Unkempt yards.
• Lack of activity inside and outside.
• Mail or newspapers piling up outside.
• New owners immediately begin heavy construction inside.
• Owners move in several items, but there is a noticeable absence of clothing or furniture.
• A three- or four-bedroom house has only one or two people seen there during the week.
• The presence of a strong smell similar to skunk odor.

Department of Real Estate Is Raising The Bar For California Real Estate Licensees

May 30, 2007 ·

California presently has 1 licensed real estate agent for every 50 residents. Most of these agents are so poorly trained in providing adequate service for their customers that serious legal problems have increased dramatically in California real estate transactions.

Under the old rules, the only pre-requisite for a licensee to take the State’s Real Estate exam was to complete 1 college-level course of Real Estate Principles. They then qualified to take the State’s real estate exam -as many times as it took to pass it. The entire process could take as little as 3 months if they scheduled and passed their State exam the first time out. The licensee would then receive a conditional license that required them to take two additional classes within 18 months to qualify for a 4-year license.

“There has been quite an influx of new agents into the marketplace over the past several years which has eroded the quality of service, the level of services and the professionalism in the industry,” said Alex Creel, chief lobbyist for California Association of Realtors, which sponsored the legislation.

To address this growing problem, Governor Arnold Schwarzenegger has signed into law a new measure AB 2429, which requires prospective licensees to complete 3 Department of Real Estate mandated courses before they can qualify to take the State’s Real Estate license examination. The measure, which is highly supported by the real estate industry, takes effect October 2007.

I, for one, applaud the Governor’s move to require much more education for California licensees. This has been a controversial topic among professional, experienced Realtors for some time as we have seen the influx of new inexperienced real estate agents in the marketplace. Agents so inexperienced and proud to confess that it took them 10-13 attempts at passing the State exam and feeling such a sense of pride and accomplishment that that was all it took to now be entrusted with the most valuable financial resource that the average person has. As selling real estate becomes more litigious, the need for on going training becomes more apparent to the professionals that take this business seriously.

Is There A Licensed Agent On Every Block?

May 26th, 2007 ·

An interesting phenomenon is occurring in California. With the market softening and the sales slowing, you would expect the number of Agents to start to shrink. From roughly 495,000 licensees (brokers and agents) to 532,000 - the number is now growing.
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That translates to be 1 out of every 50 adults in California is a licensed real estate agent. That means there is virtually an Agent on every block in the state holding a license to sell properties or do loans.
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This gold rush mentality is amazing despite the downturn in the housing market and the notoriety of the past year’s doom and gloom reports. The number of real estate license holders in California is continuing to rise. There appears to be a bit of madness running rampant throughout California.