First of all let me say that I distinguish between fraud and flipping. When professionals collude to trick sellers into taking a low price, then flip the home for a profit in a short time, this is not what I’m talking about, and it shouldn’t cloud the issue of flipping. Why do we always take the worst practices and make that the norm?
Hell, let’s change the name to something that better represents what I consider a legitimate real estate practice — let’s call it BuyRebuild&Sell (BRS) — it sounds like Briz, so let’s call it Brizzing, in order to give it dignity and a cool name.
So there is this dog of a house uglying up the neighborhood and no one wants to buy it. I come along and look at the home — yet I’m looking at it in a different way — I look at its soul. The poor darling is sitting there being made fun of, people are even cursing it — That damn ugly house! It’s killing values! Some even secretly wish it would burn down.
Now, I’m a compassionate person, and I’ve always rooted for the underdog and tried to protect those who were bullied and ridiculed for their appearance. And I’m a businessman. Yep, I’m a crude businessman who likes to make a profit.
I say to myself, this poor house needs brizzing. I’m a good brizzer — I’ve brizzed over a dozen houses now. It’s funny how some people look at brizzing — they like the fact the house has been brizzed but they hate the profit you make off brizzing. “I know what you paid for that dog of a house!” — “You are charging what? You only paid $60,000 for it!”
Yes, but I brizzed it, you dope! I took a chance on this poor ugly house when no one else would. I didn’t sit back and make fun of it and curse it, I brizzed it! I could have lost my butt on this, but I believed in this house — I saw its soul! And, I’m a businessman. I’m a crude businessman who likes to make a profit. So, shut up and admire my work of art.
I’ve even helped the community. Yes, I’ve increased the values in the neighborhood — how about that? Now people ride by the house and whistle – they yell out “Yo, little house, you’ve got junk in your trunk!” And the little house sits there all pretty and styling. Now tell me what’s wrong with that? I think brizzing is a good practice, if you’ve got the nerves for it. Just having nerve is worth a buck or two.
So quit worrying about what I paid for it, no one else would buy it, and I didn’t hold no gun to nobody’s head (that’s how us brizzers talk) – just be grateful that someone saw the beauty in ugliness and brought it to life. Brizzing is cool, y’all.
Brian Brady says:
Brizzing is way cool, yo
Brizzing is the equivalent of trading. It adds liquidity to an otherwise illiquid asset. That’s the beauty of the free market; what is one man’s trash is another’s treasure.
March 29, 2008 — 7:26 am
Dave Shafer says:
I love the professional rehabber’s! As you point out they take problem properties and turn them into neighborhood beauties. It is the folks who thought they could slap on a coat of paint and add a granite countertop and make their millions overnight that create problems. Now those homes are in foreclosure and are a real drag to neighborhoods!
March 29, 2008 — 8:59 am
Jeanne Breault says:
I can’t say I think “brizzing” is exactly the right word 🙂 BUT I think you’ve described in a nutshell the ethical and free market significance of “flipping.”
So much of what anyone who works in real estate does is risk-reward driven…investors, lenders, builders, and yes, even agents – where else can you work so hard and possibly get nothing in the end?!
We’re seeing the risk-reward free market in action right now and it makes people uncomfortable. So uncomfortable that some of us are going to pay twice…our real estate investment losses AND the federal bailout!
And on it goes…
March 29, 2008 — 9:25 am
Charleston real estate blog says:
Mike, well said (I just love the way you talk dude) and well done. By adding real value to the property, you deserve a reward, a well earned profit for a successful briz.
March 29, 2008 — 11:07 am
Mike Farmer says:
Thanks everyone. Oh well, back to the drawing board for a better name.
March 29, 2008 — 11:24 am
Will says:
I always referred to it as rehabbing. Brizzing? Meh. Could take while to catch on but whatever works for you. Just semantics, really. Most investors I meet have that cruel streak in them and like to refer to it as “slapping lipstick on a pig”… before I remind them they mean that it would still be a pig. No one wants to buy a pig.
All the same, if you can find the right deal and rehab it right then go for it. You just have to find the right deal.
March 29, 2008 — 11:41 am
Mike Farmer says:
Will, I was mainly playing to reinforce the value of rehabbing. “Flipping” has taken a bad rap because some bad actors have scammed the public, but the value of rehabbing is great in real estate and among communities — it’s progress toward better neighborhoods and beautification, and it can be profitable — win/win — so rather than denigrate greedy investors for doing the evil “flip”, we ought to applaud those who contribute to progress by taking risks that most won’t take.
March 29, 2008 — 12:32 pm
Mike Farmer says:
My comment is awaiting moderation –that sounds ominous.
March 29, 2008 — 12:35 pm
Suz says:
I haven’t heard of brizzing before, we call it flipping. Call it what you will, I like it!! Its a good thing all around. I’ve worked with several investors, flippers, brizzers and I give them alot of credit. They have vision and take a chance when everyone else just walks away. I really like working with investors because I get involved with renovations and its quite interesting to see and be a part of the before and after. My town is going thru quite a transformation right now.
March 29, 2008 — 5:50 pm
Wayne says:
Mike – I am with you. There is nothing wrong with making a profit while improving the neighborhood. I would say it is the “American Way” which is still a good thing in my opinion. The USA was built by people who were willing to take a chance and investment in something they see potential in – to hopefully make a good profit.
March 31, 2008 — 9:36 am
Suz says:
“people who were willing to take a chance…” I believe this to be key.
March 31, 2008 — 8:00 pm