Renovating Flooded Homes and Out-of-State Apartments with Jason and Pili Yarusi, Episode 40
Most investors would never even think of investing in flooded homes, but not Jason and Pili Yarusi. This real estate power couple began flipping flooded homes in New Jersey and raising their elevation. It’s no wonder they excelled at more traditional flips and are focused on renovating apartment communities. As the hosts of the REI Foundation podcast, they help others learn how to build solid real estate footings through the steps and missteps from other investors. On this episode, they explain their approach to renovating flooded homes in New Jersey and how they identified Louisville, Kentucky as an ideal market for out of state apartment investing through their commercial asset firm, Oak Capital Partners.
Key Market Insights
Jason is from New Jersey, Pili is from Hawaii and moved to NY at 21
In 2003, met at work and it took 10 years before they started dating
After Hurricane Sandy, Moved to NJ to help the family construction company
Started reviving flooded homes, raising them to a new elevation
Rapid flooding continues in areas where excess rain has nowhere to go
Flood insurance rates are going up as much as $12k/annually
Check FEMA website to see if home is in a flood zone
Jersey shore flooded home flips take 9-12 months
Flood Zones: X, AE, A, VE , V
Houston has 101,000 properties within the 100-year flood map
FEMA can buy home, but it can no longer be used for development
If looking to invest in flood zone properties: team up with a house lifter, go to the local township and learn the FEMA rules and get it in writing
Manasquan, NJ is a beach town with lots of opportunities for flooded homes
Flipping focus: Union County in North Central , NJ.
Started buying duplexes in Indianapolis working with an advisor's team
Criteria for out of market investing: Steady population growth, job growth and job diversification
Wildcard was finding a market where they had personal connections – sister lives in Louisville
Louisville major employers: GE, FedEx, Churchill Downs, Aetna
Started understanding the areas and then breaking them down to see where there was new construction
Honed in on South and South Central Louisville for working class families
Wanted population density and lots of complexes
94 unit found through a property management company
Was $1,000,000 off on the price and after 7 months the seller dropped the price and they negotiated
Leverages property management to help them know the market prior to finding the property
Bull’s Eye Tips:
Winning Your Market: Have someone on the ground, figure out what you’re good at
Tracking Market Changes: Google alerts and talk to people in the area, finding the path of progress
Daily Habit: For Pili - time blocking and doing her one thing; For Jason - meditation
Miracle Morning by Hal Elrod
Best Business Books:
Never Split the Difference by Chris Voss
12 Week Year by Brian Moran
"3% of the shoreline could recede and be under water"
"Many investors will not touch flood zone properties"
"The key to reading is implementing"
"When investing, stay boring"
Places to Grab a Bite in New Jersey:
Connect with Jason and Pili:
Email Pili: PIli@YarusiHoldings.com
Email Jason: Jason@YarusiHoldings.com
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