During this pandemic, a lot of people are taking their time to search for new investment property. Fixing and flipping properties in Las Vegas is one of the major booming industries at this time. A lot of investors are doing a deep market research to purchase houses with low prices, renovate them, and then sell these properties as soon as possible. This process is known as flipping.
Clement Ziroli, Jr. is the founder and CEO of Diamond Creeks Holdings, based in Las Vegas, Nevada. Clement Ziroli, Jr. has participated in thousands of real estate “flip” transactions, and has amassed a substantial portfolio of commercial, industrial, and residential properties.
During a business podcast called Educating Your Money Podcast, hosted by Kristin Kirui-Case and sponsored by Out And About Business Solutions, Clement Ziroli, Jr. shared some important tips that people should consider when getting into real estate flipping. (The Episode took place on November 11, 2020).
“One of the most integral parts of the flipping process is really being honest with what the true value of the property on the resale is. That would give you, obviously, the entry into what you can pay for. So you really have to understand valuation. From a realistic standpoint, a lot of times we look at things subjectively, which is the worst way to look at anything for investment. We really want to find an objective value, what it will sell for in the buyer's eyes, not in our eyes, but what it really objectively will sell for,” Clement Ziroli, Jr. said.
Comps are important when buying and investment property. For that matter, Clement Ziroli, Jr. said, “Some things are easy to comp, some things are really difficult to comp. The more mainstream type, the common track house, where there is a lot of availability and there is a lot of turnovers, tends to be easier to comp. The more difficult ones are maybe custom homes, things like that. So ideally, when you're starting, you want to pick things that are easy to comp. So you make sure that when you make the acquisition, you can rely on the value that you've established for the resale.
“That's probably the most critical thing that, you know, people underestimate, or exaggerate, or they get connected to the house in some way, and they see a value that nobody else sees. But when you're doing this for business, it really has to be objective.
“The other thing is that you have to have your capital arranged. And a lot of times, especially when you're starting, you end up paying a premium price for capital. A lot of times, we underestimate the costs to truly do the rehab. We tend to underestimate what the actual expenses will be—we can do that cheap, we can do it cheaper, we can cut a corner over there. But the real cost to do rehab is going up, you know, seems like hourly wages with increasing material cost went up. A lot of these costs—in fact, all the costs, I'd say—to rehab, have gone up fairly substantially over the last 5-10 years. So you have to be very realistic with what the cost will be. The cost of your capital and time.”
And when Kristin Kirui-Case, the host of Educating Your Money Podcast, asked Clement Ziroli, Jr. about his partners, Clement Ziroli, Sr. and Pac W. Dong, and if he still worked with them, Clement’s answer was as follows: “Clement Ziroli, Sr. and Pac W. Dong are not actually active with me in Diamond Creek Holdings. But those two people, Clement Ziroli, Sr. and Pac W. Dong , were my mentors.”
“Clement Ziroli Sr. was in the mortgage industry. He started flipping houses in the ’50s and land when he first started in the business. So Pac Dong was our CFO at First Mortgage Corporation and a top quality person. These guys are more conservative than me. I'm more one of the loose guys that wants to run and do my thing. But Clement Ziroli, Sr. and Pac Dong kind of harbored me and made me realize these elements that exist.
“Clement Ziroli, Sr. and Pac W. Dong were my mentors in this business and in other businesses as well. “
You can watch the full episode on YouTube by clicking on this link.
Read the full article on New York Weekly https://nyweekly.com/business/clement-ziroli-jr-kristin-kirui-cases-guest-host-of-educating-your-money-podcast/
Read the full article on Yahoo https://sg.style.yahoo.com/clement-ziroli-jr-kritin-kirui-110941300.html