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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Re: Scaled up to multiple county size here in CA. Posted by Shirley Karinski on March 18, 2002 at 6:08 PM In Reply to: Scaled up to multiple county size here in CA. posted by Ward-CA- on March 18, 2002 at 7:10 AM : : I've never heard of firms in the foreclosure/fixup game which are analagous to CarMax, AutoUSA, Ugly Duckling in the auto auction game. Is there something about foreclosuring which limits the effective size of the business model? : : Or is it the opposite? That there are representatives of "big" foreclose-and-repair firms at most courthouse auctions? I would guess the smaller bidders resent these types if they exist; they'd have deeper pockets and drive up the bidding. : : It just seems logical to me that "if there's money to be made in foreclosures" that there would be established players in it, who have scaled up to a statewide, or nation-wide scale. : =•=•=•=•=•=•=•=•=•=•= : Sean, your car analogy is a good example to measure foreclosures against. First of all there's the individual bid for a used car versus that of a house. Then there’s the extra time and expense in regaining the possession of the house which can be quite protracted versus snatching an unpaid car off the street. Next is the cost of rehabbing a car versus a distressed house, and then there’s the gap in monthly maintenance, and their respective reselling costs, : If the local used car market bogs down you can ship you inventory to better markets elsewhere. Can’t do that with foreclosed houses you’re holding in a persistent buyer’s market. : I think your business model for foreclosures would be that of a niche business which generates a very good living for an individual player working out of her house, but not for a business organization who, because of the scale it has to operate on, requires a very high dependable volume. : Now there are some guys who buy/sell a phenomenal number of foreclosed houses per year. My first foreclosure trainee, Gregg Metcalf ‘86, who operates in 4 counties in Southern California, bought 450 foreclosures in 2001 and is holding 240 houses in inventory! That’s an amazing number. My business has been much more typical of the average foreclosure investor. I will usually buy 10 to 12 foreclosures per year and have about 3 in inventory at any one time. I have two employees while I bet Gregg has at least 25 employees. I work with subcontractors while Gregg has his own crews. Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : : : I've never heard of firms in the foreclosure/fixup game which are analagous to CarMax, AutoUSA, Ugly Duckling in the auto auction game. Is there something about foreclosuring which limits the effective size of the business model? : : : Or is it the opposite? That there are representatives of "big" foreclose-and-repair firms at most courthouse auctions? I would guess the smaller bidders resent these types if they exist; they'd have deeper pockets and drive up the bidding. : : : It just seems logical to me that "if there's money to be made in foreclosures" that there would be established players in it, who have scaled up to a statewide, or nation-wide scale. : : =•=•=•=•=•=•=•=•=•=•= : : Sean, your car analogy is a good example to measure foreclosures against. First of all there's the individual bid for a used car versus that of a house. Then there’s the extra time and expense in regaining the possession of the house which can be quite protracted versus snatching an unpaid car off the street. Next is the cost of rehabbing a car versus a distressed house, and then there’s the gap in monthly maintenance, and their respective reselling costs, : : If the local used car market bogs down you can ship you inventory to better markets elsewhere. Can’t do that with foreclosed houses you’re holding in a persistent buyer’s market. : : I think your business model for foreclosures would be that of a niche business which generates a very good living for an individual player working out of her house, but not for a business organization who, because of the scale it has to operate on, requires a very high dependable volume. : : Now there are some guys who buy/sell a phenomenal number of foreclosed houses per year. My first foreclosure trainee, Gregg Metcalf ‘86, who operates in 4 counties in Southern California, bought 450 foreclosures in 2001 and is holding 240 houses in inventory! That’s an amazing number. My business has been much more typical of the average foreclosure investor. I will usually buy 10 to 12 foreclosures per year and have about 3 in inventory at any one time. I have two employees while I bet Gregg has at least 25 employees. I work with subcontractors while Gregg has his own crews. Optional Link URL: Link Title: Optional Image URL: [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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