Brian Daly is a successful real estate investor, entrepreneur, writer, and speaker in California. Brian flipped 25 properties last year in the San Diego area and is on pace to flip 60 this year.
In 2011 the market was overrun with inventory, that’s when Brian started investing
He worked for banks during the financial recession as an asset manager and honed his skills dealing with real estate agents
“We worked like every other entrepreneur. We had a nine to five, which was more like a nine to seven, and then from 7 pm to 12 am. We would scour the MLS and make a list of who we wanted to call the next day. Then, on the way to work, we would start going down the list as we were driving. It was a routine that we did for about six months”. – Brian Daly
Originally, Brian did a lot of direct marketing to sellers
However, in the past five to ten years, big marketing has created marketing machines that are hard to compete with
Brian now partners with real estate agents
“We focus on creating dialogue, creating a relationship with and leaning on real estate agents. And then, the leads come to us, and that’s how we focus on growing, our strategy.” – Brian Daly
Motivational sellers are his target group, especially if they’re motivated to sell quickly for cash
Brian calls his real estate agent and asks if there are any properties needing a little touch-up – or even a full renovation
He looks for homes that are neglected and won’t qualify for financing
“When the property condition is rough, a lender is not going to finance it. They’re going to require a lot of repairs. In most cases, when the property is like that, the seller is not in a position to do repairs”. Brian Daly
Brian then does a desktop analysis:
He scans comps in the neighborhood
Estimates repairs
Estimates what can he’ll sell it for
Estimates how long it will take to sell
Then his model comes up with an offer
Brian takes that verbal offer to the seller – usually within 24 hours and without contingency
Most deals are closed within ten days
Brian uses financing – from two primary hard money lenders
Hard money financing is a loan done in such a way that you can close between 3-5 days using the value of the property as the focus = an asset-based loan
Originally Brian was liable but now he no longer needs to use his personal guarantee
Yes, Brian’s maximum offer is usually 9% cash on return
On a typical house, out of pocket cash is about $510,000 (in San Diego)
90% comes from the hard money lender
The remaining gap is funded by investors
Through a joint venture that Brian does with his investor(s), they receive about 30-40% return on their money
Before starting out, be honest about your skillset