What’s up everyone and welcome to another episode of Become A Local Leader! In today’s episode, we have Joe Homs, Realtor with H&M Realty Group in San Diego, California.
Joe Homs has over 40 years of real estate experience. He actively lists and sells over 20 homes a year and in the last 10 years has sold over 600 homes! Joe is also a very skillful negotiator who works diligently to help you realize the best possible price when buying or selling your home.
In this interview, Joe shares his secrets to success in both being a real estate agent as well as buying and flipping homes.
Meet Joe Homs – Our Featured Local Leader
Where are you originally from? Which part of Orange County do you live in now?
I was born in New York but my parents decided to move out to California when I was eight. That was in the 60s. I’ve been in Orange County ever since. After we moved here, when I was eight, I haven’t really travelled too far. Since I was eight, I’ve been living here in Mission Viejo, Orange County.
Why that part of Orange County? What do you love about it?
Well, I grew up in a neighboring city, which was El Toro at the time, but now it’s called Lake Forest. There was a marine base there. I think that’s what kind of drew everybody to the area. And then, it just started growing. I just fell in love with it. I said I really didn’t want to go anyplace else and I ended up buying my first house when I was 20 in Mission Viejo. Since then, I’ve purchased three different homes that I’ve lived in. Following that, when I was 22, I purchased my first investment property.
Is there anything else you did before real estate or really, you’ve been in real estate all the way through?
Yeah, pretty much real estate all the way through. When I purchased my rental property, that was 40 years ago that I purchased it. There are no cell phones. There was no internet. I go, “Well, geez, I’ve just turned myself into a landlord. What do I do?” I decided to take a real estate course and get my real estate license. Once I finished with that, I go, “Oh my God, you can do all this stuff with real estate?” It just excited me so much that I just went into it full time.
What would you say is your superpower as a real estate agent?
I think that was really kind of given to me, taught by my father. He had numerous buy and holds in his lifetime. And during high school, he used to drive me out and say, “Hey, we’re going to go paint this house over the weekend.” Or, “We are going to put flooring in. We have to do that.”
I do flip homes now for a living as well. On the side, I’m a full-time real estate agent but I do flipping as well. I also do mentoring and teaching. My dad instilled in me those values and the ability to be able to go into a home and rehab it. So, I can start from the beginning and rehab about 90% of it.
My father, he’s the one who really taught me the business. He used to drag me out to his fix and flips and rentals and all that during high school and, you know, paint this room or fix this or fix that. And so, he kind of instilled in me that this is something that I was looking forward to and wanting to do.
What kind of inspired your dad to get into real estate and do the fix and flips?
He was always a person that you literally could not sit down for two seconds. He was always on the move. Always. He was an air conditioning refrigeration repairman by trade. And to have that kind of ability, you need to know electrical, you need to know how plumbing works. Obviously, air conditioning, ductwork, all that too. Those are pretty much the major components of a house. When I go fix a house, I have to do electrical, I have to do plumbing. I have to do all that sort of stuff.
He did it a lot, not just to keep busy but also to build wealth for him in the future, which is what he accomplished over the years.
In terms of your business, what specific areas in Orange County do you work in?
I’ve pretty much exclusively been doing fix and flips in Orange County. Here in California, we have different market cycles. We’re back at the top. So, the inventory or the availability of distressed homes is very low. I’ve had to expand that out. We’re out in Riverside and San Bernardino counties right now. Every once in awhile, we’ll venture into Los Angeles.
I actually picked up a flip here in Rancho Santa Margarita, which is in Orange County. It’s a three-bedroom condo. The lady decided she wanted to tear everything out and put back everything brand new. Once she did that, she realizes that she can’t do this. So, she put it on the market for sale and we’re buying it as is basically. A lot of the properties that we’re buying nowadays are very distressed or even extremely distressed. It’s not something that just needs painting or carpeting, it’s the major distressed properties that we almost target.
How would you say this whole situation with COVID has affected your business or has it not really affected your business?
Well, my normal working with buyers and sellers it did. It pretty much shut that business down for a while. My flip business, it shut it down for a couple of weeks. And then, the governor said that construction workers and real estate agents were essential employees. So that open business back up and I was able to get my contractors back into my rehabs and start fixing now.
If anything on my flip side, it’s been kind of advantageous with COVID because with everything going on people tend to stress. And again, I do distress buying properties. So, if somebody is distressed, let’s say you’re a homeowner and you’re renting something out and now your tenant has stopped paying, that causes stress in your life. So you’re thinking, “Well, let me get rid of this because the world’s going to fall apart tomorrow.” I kind of utilize those types of situations when identifying the right property.
We just picked up a property in Riverside where it was tenant occupied. And we bought it like that, knowing full well that we had to wait for the moratorium on eviction of tenants to be lifted before we could do anything. But my philosophy on that is I always go talk to the tenant. I like the conversation. I like saying, “Basically, here’s what’s happening. Okay. Yes, at the end of the day I can evict you but does that really help anybody here? Because if you decide to go someplace else and they pull up your records that you’ve been evicted before, do you actually think you’re going to get that place?”
So, I kind of talk them through it and kind of give them some common sense. And in most instances, they choose to move out. In one particular case, we have a thing in flipping business we call “cash for keys”. How it works is that we offer them some cash to help them move out. It’s a win-win situation, and they’ll often move out.
Can you share with us your volume in terms of the realtor side, but then also your fix and flips and then your investment properties?
On the realtor side, I’m doing probably a couple of listings a month. The market is, literally as we speak, on fire. It is a seller’s market. Everything’s going over asking multiple offers. I am also dealing with buyers. I’m dealing with buyers because interest rates just hit literally a 50-year low yesterday. You get something under 3%. I’m told it’s even going to go lower than that. So, everybody wants to buy a home and has the ability to buy a home, is out looking. And then, that’s why the multiple offers and over asking price, things like that. So that’s how the business is definitely starting to pick up which is awesome.
My buy and holds that I purchased over the last 40 years are doing great. All my tenants are paying. They’re paying on time. I’ve had no issues with that. Knock on wood that that continues. I’m not a typical landlord, I would say. I’m very responsive. When people call, I take care of their issues. I discuss with them what’s going on. I always tell people when they move in, life hits you in the face every once in a while, and I understand that.
But if it’s the first of the month and rent’s due, at least give me a courtesy call and let me know, “Hey, Joe. Can I wait 10 or 15 days to pay you?” “Yeah, not a problem. I know life hits people in the face every once in a while.” So, as long as I do that, as long as they keep in communication, I’m really responsive and give people breaks when necessary.
Whereas in my flip business, I got 15 flips that we’re doing right now. Various stages. I’ve got five of them on the market. Three of those are in escrow. The other ones are in various stages of getting rehabbed. One I am closing out escrow next Wednesday. For condos, normally, my contractor can go in and do the rehab in about 30 days. I’m into it 30 days and putting it back on the market. In this market I know it’s going to sell the first weekend. Another 30 days to close. So, about a two and a half months turnaround timeframe.
My single-family homes are a little bit longer in that they can take anywhere between two and three months to rehab depending on how much I need to do. Remember, I’m buying a totally distressed home. Think of that show hoarder house. That’s the house that I’m buying. So, sometimes it takes a lot longer to not only clean it up but to rip everything out, fix it, and put it back together. So, the single-family homes that take me about two or three months to rehab. That side of the business is going very well.
In terms of the distressed homes, how did they even get to that point?
That’s an awesome question! I wish I could answer. Honestly, I don’t know. Sometimes I walk into these homes and go, “How do people live like this?” So, I don’t really have a single answer for that. I guess human nature and what people are tolerant of? Do they have any income coming in? All those factors play into it. I honestly, don’t have a simple answer that I could tell you because there’s just a bunch of different things that would happen.
What would you say is the median home prices for your projects?
We’re doing about five homes in a senior community here in Orange County. We’re purchasing them for around $225,000. The rehab of those is a little bit more than normally we do it. We’re doing kind of an add-on. An add-on meaning that these are two-bedroom, one-bath condos. We’re converting them to two-bedroom, two-bath condos. Bringing them totally up today, that’s taking a little bit longer because we have to deal with city permits and HOA permits. At the end of the day, we’re buying for $225,000 we’re putting about $80,000 into the rehab, and we’re selling them for $425,000.
My condos and single families, outside of that community, they are really quick. We get those done really fast.
What percentage would you say is repeat business versus new business?
I have a lot of repeat business because I’ve been in the business for 40 years. I get a lot of past clients, referrals, things like that. New business in my stage of life, I’m not actively going out and looking for new business because I’ve got all these other avenues that I’m dealing with. It’s mostly word of mouth. And again, referral type business. It’s coming my way. If my normal real estate business were to stop, it wouldn’t be the end of the world for me. I think that’s what people have to look at themselves and figure out, “Okay. I’ve got this skill level but what happens if something happens to that?” You should have a backup plan in case something happens.
In real estate, I’m very fortunate that I was able to diversify. Not only do I have buy and hold properties, rental properties, but I still do full-time real estate and I also do flips. So, I’ve got a big funnel of money coming in from different sources.
In terms of what you’ve done thus far, is there anything that you found over the years that doesn’t work for you?
Because of my age, I would say that social media would be that answer even though I try to keep as active as I can. I do have a Facebook page and stuff but it’s not like I’m getting requests to list homes or anything like that through Facebook. I do market myself through a real estate website called BiggerPockets. I’m very active there. The reason I’m active there is because I like to give back to my community. I mentor as well. And so, I like to train young people to do what I do, which is what my dad did for me. So, that’s how I kind of give back.
In terms of budgeting for things like marketing, how do you determine that?
I’ve tried everything as far as social media goes. I literally get calls and texts and emails daily from people saying, “We’ll send you leads.” “We’ll fix your website.” “We’ll make you famous or whatever.” I throw money at it every once in a while, but literally, all I found, is that I’m literally just throwing money at things. I don’t get any return from it so I end up unsubscribing or stopping
Are there any things that you’ve seen other realtors do that you’d be willing to try that seem to be working for them?
I’m not looking around for other realtors and seeing what they’re doing. I’m concentrating on doing what I do and what I do best. So, it’s not like I’m out there looking for the next big thing. In this type of market where we are, you always have that next big thing coming around the corner. Whether it’s a real estate company offering you more commission and stuff, and I get a lot of calls about that as well. I don’t have an issue with that because I own the company so I get to keep all the commission. It’s not like somebody can say, “We can offer you 95% or just have a flat fee or desk fee or whatever.” None of that really pertains to me. I keep all the commissions.
I’m trying to think of what I’m spending most of my money on right now and it’s probably just a website that I have, you know, keeping that up to date and stuff. That’s really it.
Are there any other things that you do to get involved in the community, maybe even outside of your professional life?
Well, with COVID, there’s not much I could do. The biggest concentration is mentoring and training. Just anything real estate related is what I do. I don’t do much of anything else. Just the related stuff.
What would you say moving forward your goals are?
Well, I’ve pretty much achieved all the goals that I set out for myself when I was 20. My goal is to just train as many people as I can on real estate and the love that I have for it and hopefully leave some sort of legacy that somebody would become as successful as I have become in real estate. That’s really my goal.
What would you say people rave about when it comes to Joe Homs?
I would say my expertise and the ability to follow through. I’m very customer-focused. If you have a problem, I’m here to resolve it.
What would you say sets you apart from your competitors?
My experience. Without a doubt. I’ll put on my experience with anybody as long as we’re comparing apples to apples. I by far am more experienced in I’d say 95% of the agents out there.
Do you do Facebook ads?
Do you do Google ads and LinkedIn ads?
Do you do Instagram ads?
I think it is combined with Facebook. So, I’ll say yes.
Any other sources of leads?
I do have another website company that supplies me with leads.
What about retargeting?
What about paying a digital marketer to do some of your social media for you?
I’ve done that before and never get really any traction out of it.
What about advertising on bus benches, grocery carts, or any display advertising?
What about direct mailers?
What about writing blogs or having blogs written for you?
I don’t write as much as I probably should. So, no, not really. I don’t have anybody ghostwriting for me either.
What about creating video content?
I hear that’s the next big thing but I haven’t done a lot of that at all.
Are you active on social media?
No, not too active.
What about a newsletter? Do you offer a newsletter and how frequently if you do?
No, I don’t.
What about things like virtual open houses, regular open houses?
Open houses have shut down. Pre-COVID, yes, we would do open houses on our listings. Our flips are totally staged so it’s easy to do an open house on that because you have the nice furniture to sit down on and people appreciate it more when it’s staged. So yes, we do open houses.
What about for working your database, do you pop-by?
No, I probably should work my database a lot more than I do. I do have drip email systems that I place people on but I definitely should be doing more of that.
Do you practice writing personal notes, sending gifts, or client appreciation parties?
How often would you say you call, text, or direct message them?
Not often. Okay.
Do you do cold calling?
I personally don’t. We have a couple of agents that are doing cold calling in our office for us, and they’re looking for distress leads for us.
Do you do door knocking?
Door knocking is what I used to do 10 years ago, religiously. I love door knocking. But I don’t do a lot anymore because the doors that I was knocking on were distressed. They’d received a notice of default or they were getting foreclosed on. Those weren’t the best doors for me to knock on because I already knew they were in trouble. I wasn’t doing traditional door knocking, which is literally going around the neighborhood knocking on everybody’s door, introducing yourself as a neighborhood agent. Rather, I was doing more targeted door knocking. I love doing that and I still love doing that. But I don’t do that much anymore, especially with COVID.
What about prospecting FSBO?
I don’t do that either. I guess my kind of philosophy for FSBO and I’ll include expired listings in there, is that these are people that are unreasonable, to begin with. They are basically telling you they don’t want to work with a real estate agent. Even though just putting your property on the Multiple Listing Search is probably the most powerful tool that’s out there. It gets exposure, forever, for everybody out there in the entire world. How can a FSBO just put a sign in the front yard and expect to get a sale, off of that? I just don’t want to waste my time knocking on those types of doors.
And then on the other side with expired listings, it’s expired for a reason. The number one reason a house doesn’t sell is because of the price. If you don’t get the price down to where it should be, which is what the agent, the professional is telling the seller, and obviously they’re not listening, the listing expires. And then, they either move on to somebody else or they just pull it off the market entirely. I don’t like dealing with unrealistic people so I don’t target them at all.
Any final thoughts? What would you say to realtors out there who want to become recognized as the local market expert and the go-to realtor in their community?
Find an area of expertise that you can specialize in, a niche that you enjoy doing and become an expert in that niche. Once you do, through word of mouth, it’ll get out there that this is what you like doing and you’re good at it. People will start realizing that.
Hey, if you liked the show, be sure to share it with your friends and colleagues! And if you want to learn more about Becoming a Local Leader, then be sure to check out how other agents are becoming the go-to Real Estate Professionals in their communities.