Should I Invest In Land Bank Homes? – Sam Hindo
On this episode of The Closing Table, we sat down with Sam Hindo!
To watch the full episode, check it out on YouTube below. In the meantime, here’s a summary of the conversation…
Here’s what you missed from Sam Hindo…
The conversation began with Sam introducing himself beyond the realm of real estate. Sam emerges as a dynamic individual with a primary identity as an investor. His journey into the real estate business was marked by a focus on embracing various deals, delving into diverse markets, and concurrently practicing real estate while fostering his investment portfolio. Beyond his professional pursuits, Sam exudes an athletic spirit, frequently dedicating time to gym workouts and actively engaging in a lifestyle that thrives on interaction and networking events.
Transitioning to his role as a real estate professional, Sam brings a wealth of experience accumulated over approximately 4 and a half years of licensure. His niche lies predominantly in the Wayne County Detroit market, where he unexpectedly found his stride in dealing with investment properties. While not originally intended, this niche has become a source of genuine enjoyment for Sam, facilitated by the constant demand from investors seeking properties in the Michigan market throughout the year. Sam’s notable achievements are anchored in his adept navigation of this market and his ability to consistently attract new business.
Geographically, Sam’s current market is Southeastern Michigan, with a primary focus on the Greater Detroit Area. The region boasts landmarks such as the Riverwalk, while nearby attractions include beaches in Traverse City and Mackinac Island. The cultural vibrancy of Michigan is noteworthy, with a distinct shift in activities between the summer and winter seasons, reflecting the local tendency to stay indoors during colder months.
Economically, Sam sheds light on key market indicators. The average house in Michigan spends around 76 days on the market before being sold, with a remarkably swift average pending time of 8 days. This rapid turnover underscores the dynamic nature of the real estate landscape. Sam identifies Berkeley, Inkster, Dearborn Heights, Auburn Hills, and East Lansing as the top investment markets, offering promising returns on average for those seeking lucrative opportunities in the region.
Sam adopts a meticulous approach to property analysis, emphasizing the significance of researching the street and its dynamics before considering any investment. His strategy involves assessing the speed at which houses are being sold in a particular area and gauging whether it is an appreciating market. The focus is often on areas where houses are appreciating rapidly and can be acquired at a favorable price.
An example of this strategy is evident in Sam’s successful foray into the Inkster market. Despite historical discouragement, Sam foresaw its potential, anticipating that as adjacent areas like Dearborn Heights and Redford became pricier, investors would turn to Inkster—a prediction that proved accurate. His ability to identify these subtle market signals underscores the effectiveness of his property analysis methodology.
Sam is candid about his views on “flat rate MLS listings,” branding them as “the biggest waste of money” in real estate. He elucidates that this service entails a client paying a flat fee (e.g., $500 or $1000) to list their home on the MLS without the representation or negotiation support of an agent. While this approach may work for rentals, Sam emphasizes its inadequacy for home sales due to higher stakes and risks. He reinforces this perspective by sharing a client story, where he dissuaded someone interested in a flat rate MLS listing. The story serves as a cautionary tale, illustrating the limitations of this approach and the potential struggles faced by sellers without dedicated agent representation in the competitive real estate market.
Discussing land bank properties, Sam is unequivocal about their unsuitability for the average consumer due to issues like blight and high renovation costs. Drawing from his personal experience, he recounts buying his first land bank house at 25, deeming it the “biggest waste of time” in his life. Sam emphasizes that land bank homes are not for everyone, especially inexperienced investors lacking sufficient capital for renovations within the strict timeline provided by land banks. He candidly states his aversion to land bank properties, underscoring his commitment to honesty in steering clients away from potentially problematic investments.
Shifting to new construction properties, Sam shares insights into evaluating their quality and potential issues. Advising clients on the importance of assessing the quality of updates, he notes that not all new constructions feature top-of-the-line finishes. Sam emphasizes the distinction in quality based on price range, with lower-end properties typically having standard updates and higher-end ones exceeding expectations. He advocates for personal involvement in the construction process when considering a purchase, expressing a preference for being in control from beginning to end.
The conversation wraps up with Sam stressing the significance of a savings account when buying a home, regardless of qualifying for down payment assistance loans. Reflecting on his own experiences, he suggests a minimum savings of $30,000 to cover living expenses and adjustments after acquiring a home. Sam dispels the misconception that down payment assistance is sufficient, highlighting the often underestimated need for additional funds to personalize and maintain a new home. His advice positions savings as a crucial element in the homebuying process, enabling individuals to navigate the financial demands that come with homeownership.
Check out Sam Hindo:
Facebook Business Page: https://www.facebook.com/profile.php?id=100013185078287
If you loved this episode subscribe so you never miss one! Want more The Closing Table content? Head over to our blog.