Sometimes the house has held on through three decades without an update. Sometimes a former owner has taken a sledgehammer to the walls after the house had been repossessed. Sometimes the house is just plain ugly.
But sometimes theses houses can close in seven days without seeing a day on the market.
Jim Conger of HomeVestors buys houses. He takes them in whatever condition they are in, works a little remodeling magic and them sells them for a profit.
“We basically buy ugly houses or ugly situations,” Conger said.
“Ugly houses” is self-explanatory. “Ugly situations” are those that mean a person needs to get out of a house quickly, and they may not have the time to let it sit on the market for months on end. Theses situations include divorce, death in the family, job loss, problem tenants or mortgage delinquencies.
HomeVestors has been in the ugly business since the early 1990s. It now has more than 250 franchises across the country, including the one that Conger opened in January in downtown Boise. These franchises have two options in buying and selling a house: first, they can remodel and re-sell the house to a new inhabitant, and second, they can find and buy the house but then sell it to an investor for rental or rehabilitation.
Conger grew up “on the working end of a chainsaw,” he said. He loved college because it got him out of his family’s logging business and into something he loved: construction management.
After graduating from Boise State University, he started working for a construction company in Las Vegas, then moved on to land development. In 2000 he started Conger Management Group, which does site development for mostly residential projects.
In January of this year, as land development saw a downturn, he started researching opportunities for startups and found HomeVestors. Conger said the opportunity to buy in to the name recognition and brand awareness embedded in HomeVestors drew him to the franchise – potential customers can see the company’s big yellow signs on billboards across the nation. And while Conger’s business is privately owned and operated he said he gets to tap into the knowledge of the whole franchise.
Conger said he’s been in involved in real estate for more than 12 years, and HomeVestors is another form of what he loves. “It’s very challenging. You have to buy right, remodel prudently and sell perfectly.”
Buying right means looking for a house in the right location at the right price. Conger employees two buyers who are in charge of finding these houses – they take calls from potential sellers and head out to those homes usually that same day, making an offer as quickly as possible.
HomeVestors pays the closing and realtor fees, usually closing the house in two to seven days. Then the remodeling begins. The company spends $8,000 to $24,000 on the remodel, replacing floors, painting inside and out, updating fixtures and re-landscaping the yard – “basically what the wives want when they move in,” Conger said.
The remodel takes the form of whatever is expected in the neighborhood, Conger said. Sometimes it calls for just the basics, sometimes it calls for more, like an extra bathroom or another addition.
After the remodel, reselling “perfectly” involves setting the right price so the house doesn’t linger on the market and eat up investment. Conger said it can get discouraging for house seeker to go through old house after old house and confront the reality of what is in their price range. But when they go through an old house that HomeVestors has remodeled, they see the new carpets, windows, fixtures and updates.
“What they’re getting is a used-home price but a brand new remodeled house,” Conger said.
And the neighborhood gets the new-house upgrade, too.
When HomeVestors brings the house up to quality standards, the neighbors benefit from the removal of an eyesore. “They’ll love us when it’s done,” he said.
