For a few years, it seemed like every day was my first day. I moved to Jacksonville about 10 years ago, leaving behind my corporate job and the cold winters of the northern Midwest. I’d been saving up for years and wanted to make my money work for me, not the other way around. I’d heard that Jacksonville was a hot real estate market and was dying to try my hand as an investor.
After spending most of my life working for this boss or that boss, I was determined to go it alone. I studied the business, learned the market, and started looking for leads. But with property after property, either someone else got there first or the deal wasn’t real. Turns out, I wasn’t the first person to try investing in Jacksonville, Florida real estate—far from it. Powerful, established players had deep control of the market. If I was going to make it as an investor here, I knew I needed to learn something about them. Here’s what I found out.
The Big Fish Flipping Houses in Jacksonville, Florida
There’s big fish and little fish swimming around the Jacksonville real estate market. The little fish, like I was, stay close to home, snapping up a deal that the others have left behind. This group includes newer house flippers and wholesalers. The big fish come in a few different shapes and colors, but they all make plays around the region. They can be large, local house flippers or real estate investment firms. They know where to find the tastiest investment opportunities and have the resources to secure them. But it’s the bigger, national or foreign real estate investing firms who are like whales swimming into the area for a feast. Some of them have a strong presence in Jacksonville, while others just visit for a deal every so often.
Every little fish wants to be a big fish. The big fish—large, local real estate investing firms—dominate the local market. To invest, you’ll need to work with them or work around them. Learning who they are and how they operate will help you and your Jacksonville, Florida flipping houses business grow. Here are three of the biggest:
JWB Real Estate Capital
JWB is a whale—a national real estate investing firm with an active Jacksonville real estate presence, frequently making deals here. With over 60 members on their team, they have industry expertise in nearly every field related to real estate investing. However, not all of those 60 members live around Jacksonville—so while JWB has deep pockets, they don’t necessarily see every deal in our area.
While JWB deals in all aspects of real estate investing, they have focused recently on selling rental properties to local real estate investors. Doing so increases their buying power, as they can invest more confidently knowing they have a steady demand for their properties. It also allows them to cherry-pick the rental properties they hold onto, saving the most profitable and easiest to manage for themselves.
JWB provides you with a low-risk way to enter the market by purchasing one of their rentals but you won’t find that the margins make a lot of sense. For many of the properties they offer, most of the work is already done. So, you won’t be able to buy low and the opportunity to build the most sweat equity will already be past.
Corner Lot Properties
Corner Lot Properties is a big fish. They service all of the state of Florida, but Jacksonville and the surrounding counties are really their home waters. Corner Lot focuses on cash purchases, which they sell wholesale, retail, and as turnkey rentals. While they don’t have the scale of JWB, they make up for it with focus and deep local knowledge.
As a little fish, working with Corner Lot Properties opens up what may seem to be solid investment opportunities. Their rentals come already renovated and management is handled by an experienced firm—theirs. Tenants often come with the property—all you have to do is sign the paperwork, which is convenient for those who just want to dabble in real estate investing but not make any real returns.
Their wholesale properties can give you a foothold in the market as well. While wholesale properties can be relatively inexpensive, they will be subject to a markup as they pass through Corner Lot’s hands. As this occurs before renovations, you should carefully check the margins before planning a purchase. Perhaps the best way to work with Corner Lot Properties, then, is to sell them houses wholesale—but for that, you’ll need distressed homeowner leads.
Jax Investments didn’t get their start in Jacksonville, but they’re certainly a big fish in the area, holding hundreds of local properties. Their process is simple and focused: they buy foreclosed single-family homes, renovate them, hold for appreciation and cash flow, then sell. They have their process so streamlined that they provide it as a service for other real estate investors.
To start, JAX offers a foreclosed home for you to purchase. Then, you place rehab funds in escrow. JAX completes the renovation in 2-3 months, withdrawing funds from escrow in stages. Then, a third-party management team finds tenants and you gain access to a stream of passive income.
Once again, for investors without much experience, this can seem like a sound offer. Relying on the firm’s experience reduces risk and removes much of the complexity of managing your own project. Likewise, an established partnership with a property management company soothes the headache of holding rental properties—if you have extra money to throw at the job.
Unfortunately, however, this set-up rules out hard money loans, which won’t allow you to draw funds until after renovations. You might be able to take out a 203(K) or HomeStyle loan, but you’ll be stuck at owning one property at a time. That’s fine if that’s where you want to stop, but it severely limits your growth as a professional house flipping business.
The experience has some value; this can be a good way to learn how to hunt. But, big fish hunt for themselves.
Becoming a Big Fish On Your Own Terms
The more I studied the patterns of the working real estate investment companies in Jacksonville, the more I became convinced I would need some help. While I was able to coexist, taking advantage of certain deals, I felt like I was stuck at the bottom of the food chain. After I learned the ropes, I realized what I really needed was access to leads—before the other companies could find them. So, I became an independently owned and operated HomeVestors® franchisee.
HomeVestors—the people behind the nationally-known and trusted “We Buy Ugly Houses®” billboards—provided that access to the qualified leads I needed. Calls from distressed homeowners wanting to sell fast started coming directly to me. I started in the wholesale sector, selling houses to other investors and other local franchisees, learning every time. Soon enough, I was managing rehabs and making sales. Now, I only wholesale when I just own too much property to handle at once, and I keep growing steadily. I may not be the biggest fish in the sea yet, but I’m definitely competing with the bigger fish.
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