There’s no real estate market in the world quite like the one in Bakersfield, CA. When I first started flipping houses in Bakersfield CA in the mid-2000s, the city was humming with upwardly mobile and hardworking people eager to settle down somewhere comfortable – and not much has changed!
Since then, I’m happy to report that the city has remained a great nexus for house flipping. With rapidly rising prices, plenty of buyers and sellers, and a smattering of different niches for real estate investors, Bakersfield is a great place to get started. And though the so-good-it’s-a-steal deals of the early 2010s are firmly in the rear-view mirror, there are still more than enough opportunities to capitalize on.
If you’re thinking about getting started as a flipper in Bakersfield, tag along with me as I walk you through four of the market’s most important tips to remember. Even if you’re already doing well and getting your business off the ground, I’m confident you’ll still learn a thing or two, so let’s dive in.
1. Have Several Reliable Sources For Leads
The most important thing you need to flip houses in Bakersfield CA is a good collection of leads.
Most real estate investors find leads by:
- Looking at foreclosure and pre-foreclosure listings
- Looking at MLS listings
- Running local marketing campaigns reaching out to homeowners
- Talking with other investors
- Working with a real estate business development agent or wholesaler
Bakersfield is a hotbed of foreclosure activity, so it’s a great place to start your search. You can expect a steady stream of foreclosures hitting auction, not to mention a plethora of pre-foreclosures. Similarly, there’s enough turnover in the Bakersfield market that cruising MLS listings is more effective than it would be in cooler markets.
No matter which source of leads you end up using the most, I highly suggest keeping your eye on every source that’s available to you. The more leads you have, the more you’ll be able to discriminate between the highest quality opportunities and those that are merely average, and that’s great for your bottom line.
2. Don’t Be Afraid To Go Downmarket Or Upmarket
Most of the housing stock in Bakersfield has been built since 1970, with some exceptions in the downtown neighborhoods that tend to skew either much older or newer than the city’s average.
Accordingly, you won’t have trouble finding homes for sale at every tier of the market in Bakersfield, and there are buyers of all stripes too. If you want to compete in the low-cost homes segment, you won’t be short of opportunities, and the ball will be in your court when it comes to deciding how much to invest in upgrades relative to what you think likely buyers can support.
And while the upmarket segment is small, demand for luxury housing is growing.
What this means is that if you tend to target middle-of-the-road properties in terms of their sales price and value-add that your services provide, it’s worth stepping out of your lane from time to time. Though shifting neighborhood dynamics mean you’re unlikely to sell a cheaply bought home for luxury home prices even after a renovation, there’s definitely demand for tuning up some of the worn upmarket homes in more expensive areas.
So don’t confine yourself exclusively to certain segments; you’ll be leaving money on the table.
3. Valuation Is Key
As with all real estate investing, house flipping in Bakersfield CA lives and dies on the valuation calculations of the investor.
Remember, Bakersfield is a diverse place with buyers and sellers from every segment of society – and that includes other real estate investors too. Lowball offers will probably be effective when you’re working with pre-foreclosure or foreclosure prospects, but mid-market and up-market homes are liable to get snapped up by a more competitive offer.
On the other hand, your profit margin will be perpetually under pressure if your offers are higher than necessary.
Market history and experience are the two factors that will help you refine your valuations of properties the most. Looking at which types of homes were bought and sold at certain price levels over time is the best way to build pricing expertise. If you’re not sure how to value a property, I often find that it’s helpful to consult with a more experienced investor.
4. Consider Approaching Rental Property Owners
Bakersfield is a market where rental properties are in short supply. But many of the rental properties are downmarket, which means their owners typically don’t invest much in maintaining the quality of their units. Nor do the units entail a high monthly rent on average.
Thus, rental owners are often amenable to selling their properties to you in exchange for the lump sum that you’ll be able to give them with the help of the correct financing source. Then you’ll be able to repair and flip the property, potentially back to another landlord.
Buying from rental property owners is a great thing to do because it means you’ll be improving the quality of the housing stock for everyone and expanding your network.
There’s no one way to find rental property owners that might be open to selling, so I suggest that you ask around and keep your eyes open while investing in other properties in the meantime.
Launching Your Business In Bakersfield
If you’re looking at the above tips and think you’re not quite ready to start flipping houses in Bakersfield CA, take heart: Real estate investing isn’t easy anywhere, but Bakersfield is a great place to start. And if you become an independently owned and operated HomeVestors® franchisee, you’ll have a plethora of resources at your fingertips that’ll make your life much easier.
Being a HomeVestors franchisee means you will gain access to a nationwide network of investors who are always working to help each other out. You’ll get house flipping training, access to proprietary property valuation software, and direct links to high-quality financing sources – not to mention the HomeVestors lead generation platform.
As a result, you’ll be better equipped than a lot of the other real estate investors out there, and you’ll be ready to compete in Bakersfield or anywhere else you could dream of.
If you’re considering starting a real estate investing business and want to know more about how to flip houses in Bakersfield, request information about becoming a HomeVestors® franchisee today.
Each franchise office is independently owned and operated.