ABC news presents – Bargain Homes for Sale with Bruce Norris  [5 minute video]

Bruce Norris, a well known Riverside, California real estate investor was on ABC’s Nightline. 

This is one of the few examples of professional real estate investors being part of the solution to the current market crisis.  Finally, main stream media portrays investors as something other than “vultures.”

His cost basis in the property is pretty good.  About $100k invested with rents of $1100-$1200.  Thus the monthly rent is greater than 1% per month of the home’s purchase price.  Historically the 1% rent ratio is difficult for investors to obtain in California.   In fact when I invested in Texas real estate (lower priced), 1% rent ratio was considered good.

By the way, Bruce mentioned going through trustee sales was a good way to buy houses for investment.

For those of you looking to rehab and then rent or flip houses, here are some notes I took regarding Bruce’s renovation choices.  Note that he has purchased over 1000 homes for investment.

Norris bought a basic 3/2 house for only $55k in California plus improvements (costing $38,000), which include:

  • Granite counters (remember when only millionaires had these in their homes)
  • New solid wood kitchen cabinets
  • Neutral paint, with white paint on trim and ceiling
  • 12” tile in walk ways and kitchen
  • New stainless steel appliances

During the real estate bubble, investors were part of the problem because they increased demand for housing, pushing prices even higher.  Now in the bust, they can be part of the solution for the excess housing inventory.  Otherwise, these beat-up, empty homes would be left to rot in neighborhoods across the country.

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