0 to Financial Freedom Flipping Manufactured Homes

John Harcar (00:01.102)
Hey guys, welcome back to the show. I’m here with Jason. It’s Velie, correct?

Jason Velie (00:06.389)
Really.

John Harcar (00:07.21)
Velie Jason Velie, I’m your host John Harcar. I’m here with Jason Velie and what we’re going to talk about today is going to go in from zero to financial freedom flipping manufactured homes. Remember guys at Investor Fuel, we help real estate investors, service providers and really all real estate entrepreneurs, two to five extra business by providing the tools and resources to build a business you’ve always wanted and to live the life you always wanted. So Jason, welcome to the show.

Jason Velie (00:34.574)
Thanks man, excited to be here.

John Harcar (00:36.268)
Yeah, I’m super interested in talking about your journey. We had, talked a little bit off the camera, off camera, but you know, before we get into all that and get into the weeds of things, you know, tell our audience a little bit about you kind of, know, where you came from, how you got into real estate and those kinds of things.

Jason Velie (00:51.02)
Yeah, thank you. Yeah, so like you said, my name is Jason. I’m in the Wilmington, North Carolina market. So Southeastern NC by the beach. I’ve got a wife of 12 years and we have five children so far. So life is crazy.

John Harcar (01:03.928)
Hmm so far I mean is there like plans down the road for more? Right on

Jason Velie (01:10.062)
Maybe the door’s not completely closed, but not rushing anything at the moment. yeah, so my background is in finance. I went to school for finance. I became a licensed financial advisor for a short time. Then I went to work with institutional trust funds as a trust officer. And while I was working in trust, I started to get more serious about the idea of real estate and

At first, truthfully, I thought I would just get rich the slow boring way with real estate where you save up, you know, 10, $20,000 to put as a down payment on a cheap rental. And then you wait three, five, six, seven more years to save up another 10 or 20,000 and then buy another rental, you know, and still work the W-2 until retirement age. And then maybe when I’m retired, I’ll have 20 or 30 paid off rentals was that was the initial thought. But then

John Harcar (01:55.396)
Mm-hmm.

John Harcar (02:07.543)
Sure.

Jason Velie (02:08.822)
right when I was buying my first rental property, somebody introduced me at a friend’s wedding, some random guy, I don’t even remember who he was, introduced me to the Bigger Pockets podcast. And I started listening to that and just became addicted to learning. And the biggest thing to me was the biggest light bulb moment was learning about hard money and private money. And I was just like, wait a minute, you mean to tell me that

John Harcar (02:17.559)
Hahaha

Mm-hmm.

Jason Velie (02:37.388)
all I have to do is go out and find a good enough deal and somebody out there will loan me a hundred percent of the purchase and rehab. You know, that’s nuts. And so I was crazy enough to try it and I found my first deal, which was a double wide on land in my hometown. And I used a hard money lender, even though I had no money, I had no experience. I only thing I had going for me really was that I had decent.

John Harcar (02:55.138)
Okay.

Jason Velie (03:05.28)
income history and decent credit score. That’s about it. But this, found a hard money lender that was willing to lend me a hundred percent of the purchase in the rehab, even though I had no experience, even though it was a manufactured home, because most don’t touch manufactured homes. And so to get the deal closed, I had to bring about $8,000 worth of points and closing costs to the table. I didn’t have $8,000. I literally

John Harcar (03:09.709)
Mm-hmm.

John Harcar (03:19.69)
Right.

Jason Velie (03:34.086)
used Venmo in a way to do a cash advance on a credit card so I could get that deal closed and then I got the handyman that was doing it was only a ten thousand dollar rehab that took him

John Harcar (03:39.576)
Hmm.

John Harcar (03:46.484)
So it wasn’t like a take it down, gut job type of deal.

Jason Velie (03:50.836)
No, no, super simple. And the handyman lived in my neighborhood. He knew me and trusted me. So he knew how draw schedules worked. He knew that that lender wasn’t going to give me the 10 grand upfront, that they would only give it to me after the job was done. So he agreed not to get paid until we finished. So I bought all the materials on a credit card. And then when we got the 10 grand from the lender after the rehab was done, I paid off the materials from the credit card and then paid him his money for the labor.

John Harcar (04:02.083)
Mm-hmm.

Jason Velie (04:19.692)
And then we got it listed and I ended up netting a little over 26,000 on that first flip. And that was, that was even after, because that was when COVID started, we listed it in January of 2020. So the contract fell through when we went to sell it two different times, almost fell through a third time. So even though the rehab only took 10 days, we held it for a total of five and a half months. And even with all of that and those troubles,

John Harcar (04:25.901)
Wow.

Jason Velie (04:49.29)
still made that much money on it. And so that was kind of proof of concept for me. And when I started to try to find more flips and keep going down that route.

John Harcar (04:53.239)
Yeah.

John Harcar (04:58.019)
Got it. OK, so you’re in finance. You’re a numbers nerd, I think you said on here, self-proclaimed somewhere. Yeah, nerd for numbers. So you’re in finances and all of you listen to this podcast, right? And you’re like, boom, light bulb, right? How did you go out and find this first flip? how did you find this first manufacturer tone?

Jason Velie (05:12.046)
Yes, sir.

Jason Velie (05:20.162)
Yeah, no, great question. That, truthfully, I got incredibly lucky. So my wife and I, we would walk every evening with the kids in the neighborhood and we, cause we lived in that same neighborhood and there was this one house that I saw that I knew was vacant. The mailbox was taped closed. The grass was overgrown. There was an abandoned vehicle in the driveway. So I took a picture of it and I posted it in our neighborhood Facebook group.

And I said, Hey, does anybody know who owns this property? I’ve tried to find their phone, skip trace some, can’t get ahold of the owner. I’d really love to see if they’d be willing to sell it. Well, nobody gave me the answer to that question, but because I put in that work to ask somebody else saw that post that was in the neighborhood and messaged me privately and said, Hey, we’re about to move out of our house on the next street over.

and move in with my mother-in-law who’s legally blind and needs help and we won’t be able to afford both mortgages, would you be interested in buying ours? And then I was, I just asked, sure, do know how much you want for it? And they gave out a number that was low enough that I knew that, okay, this sounds like a great deal. And so then we went and looked at it and negotiated the price and got it done from there. But truth be told, I…

John Harcar (06:34.293)
huh.

Jason Velie (06:40.268)
I had no idea how I was going to fund it when I first got it under contract. And that’s a big takeaway that I love to share with new people is that you don’t need to get so caught up in the weeds on every single step of the process and knowing exactly how you’re going to do everything. Just go and take action and find a deal. If you find a deal that’s actually a deal, finding the money for it will be the easiest part of the whole process.

John Harcar (07:06.775)
Well, let’s talk about that, right? You’re new, right? You haven’t done a deal before this. And this was, I don’t know if you’ve studied manufacturing homes before this, but how did you know how to underwrite it properly? And how did you know it was a good deal?

Jason Velie (07:19.982)
Yeah, so I knew instantly how much it was worth, the ARV, the after repair value, because I lived in that neighborhood. So I knew those values without even really needing to check comps. So I knew that this one would be worth around 120 whenever we sold it. And so I was basically just using the 70 % rule numbers that I had been told. So I took the 120 times 0.7.

John Harcar (07:38.759)
huh.

Jason Velie (07:48.396)
and then I subtracted 10,000 for repairs and I knew that number was my maximum allowable offer but I ended up getting it cheaper than that because they threw out the low number first. They threw out a number at 65 which was below 70 % roll numbers and then I was able to further negotiate to 60 so I ended up buying it for 60, putting 10 into it and then selling it for…

John Harcar (08:01.527)
Okay.

Jason Velie (08:14.83)
I think we sold it for $125, but with 5,000 concessions.

John Harcar (08:18.435)
Yeah, okay. All right. So you’re using the 70 % rule, which some of our people didn’t know it’s 70 % minus repairs. Did you include your assignment fee on that as well? Like minus your fee also before you came to that MAO?

Jason Velie (08:33.432)
There’s no assignment fee. I was direct to the seller and I bought it.

John Harcar (08:35.071)
Or you just you’re you’re buying it. Okay. Okay. That’s right. That’s right. Got it. Got it. Okay, cool. So you did this one your juices are pumped. You got money that came in got nice little profit. What’s your next step? What do you do next?

Jason Velie (08:48.044)
Yeah, so next is the unglorious part because it took me probably eight months to find my next deal. It was so hard for me to find a deal. And I think I was spoiled because of how quickly I did find the first flip that I thought it was going to be just as easy or happen just as fast. And then I do that second deal and it was incredibly stressful because I trusted somebody else to be a project manager and he

John Harcar (09:04.099)
Mm-hmm.

John Harcar (09:07.576)
Yeah.

Jason Velie (09:16.974)
horrendously over rehab the property and basically doubled an already big budget. And we ended up doing okay and making a little bit because we listed it because of how high end he did all the finishes and stuff. We listed it way higher than comps, which to me I don’t like to do. That’s incredibly risky and speculative in my opinion. We don’t know if it’s going to appraise. But thankfully

John Harcar (09:23.82)
Hmm.

John Harcar (09:35.346)
huh.

John Harcar (09:40.109)
Yeah.

Jason Velie (09:43.854)
it we got it done at first it didn’t appraise but the buyers wanted it so bad that they went to a different lender changed lenders and got a new appraisal done and the second appraisal came back where we needed it thankfully so after it’s ironic because after that one I told my wife after how stressful it was I was like I don’t I don’t think I’m gonna flip any more houses after this I think I’ll just stick to to rentals and

John Harcar (09:52.867)
Mmm.

John Harcar (10:06.487)
Hahahaha

Jason Velie (10:11.342)
Then the third deal probably took another six months after that to find that one and it went okay And then it was really once I got to around deal four or five and six that things started clicking I started having credibility with wholesalers that would bring me deals and My own marketing channels. I started figuring out what works for me. What doesn’t I started working out? You know what lenders would work for me and what contractors I worked well with

John Harcar (10:27.99)
Mm-hmm.

Jason Velie (10:39.212)
So was really after doing a handful of deals that some of those aspects started getting easier.

John Harcar (10:45.997)
Got it. Well, let’s go back and talk about kind of those first couple deals because a lot of folks, you do like you said, you got lucky on that first deal and then you kind of had to embrace the suck. So tell us some of the mistakes or challenges or things that you had from deal one to deal two to deal five when you were getting started that might be able to help some of our folks avoid.

Jason Velie (11:10.306)
Yeah, for sure. I’d say deal two is the biggest example of mistakes is that I gave that project manager person way too much control. gave him way too much authority to be able to give the contractor permission to do some of those things. And it would just get to.

John Harcar (11:32.856)
Mm-hmm.

Jason Velie (11:35.276)
the point where it’s like, well, we already redid this part and this part really nice. We really can’t leave this and we got to do that. so, you know, I’d say, you know, in hindsight, if I were to do that rehab now, I would do it completely differently. I would, I would not have that project manager, of course, but I would also have a pretty strict rehab budget, you know, broken down item by item. And I’d have

John Harcar (12:01.667)
Mm-hmm.

Jason Velie (12:02.412)
my contractor that I work with regularly that’s able to do it within that budget, would tell him to make sure he sticks to that budget. And if that means that something has to be cut out along the way or something else pops up, just let us know and we’ll figure it out. Because the safe way to do this is not by over rehabbing and trying to make some HGTV quality product and then listing it way over comps. The safe way to do it is to

John Harcar (12:25.709)
Yep. Yep.

Jason Velie (12:31.234)
Check your comps, know what it’s gonna sell for, and maybe even assume a slightly lower ARV than comps if you wanna be safe, and especially the way the market is right now. Maybe take 10 or 15 grand off of that resale price that you’re assuming. And when you’re starting, go ahead and assume the rehab is gonna cost you 20 % more than you think it will, and assume the job’s gonna take you twice as long as you think it will, because…

John Harcar (12:42.275)
Mm-hmm.

John Harcar (12:54.315)
Yeah.

Jason Velie (12:59.544)
they often do until you’ve done a lot. And I mean, I’m saying dozens of them. It’s really hard to really drill down on a realistic timeframe and a budget. If that makes sense.

John Harcar (13:13.891)
That’s just because of all the stuff that comes up,

Jason Velie (13:17.516)
Right. The stuff that comes up and also just not being very clear setting expectations on the front end with the contractors and stuff. I mean, like I said, I take full responsibility for what happened with that deal with that project manager because I didn’t have enough forethought to be very frank with him upfront that, hey, this is the budget. This is all that we can spend. What exactly are we doing? What are we not doing? And if there’s

If it looks like we might go a penny over that, come talk to me first and let’s figure out if it’s really gonna be worth it or not.

John Harcar (13:53.795)
Yeah, now that that makes sense. So you’re on deal five, six, whatever. What’s your focus? Because I know we talked about like manufactured homes. I know you didn’t fit single families. So at this point, once you’re kind of getting your groove going, I mean, are you doing more of one than the other?

Jason Velie (14:11.746)
Yeah, I would say, you know, these days we’re probably, you know, maybe 50 to 60 % of our flips are manufactured homes. The rest are stick built. When I initially started, it probably was a little more heavy on manufacturers, maybe 75%. And, you know, there’s a few reasons for that. One is most local investors, more so then than now,

John Harcar (14:23.693)
Okay.

Jason Velie (14:41.326)
were afraid to touch them. either… Some of them have been in the game for a while and they’re used to these things only being worth 60, $70,000 with the land and they don’t think there’s any money to be made there. But now those things are worth 200, 250, 280. So there’s plenty of room to make money on them now. But also what I found is a lot of experienced house flippers just have some…

John Harcar (14:43.139)
Mm-hmm.

Jason Velie (15:09.674)
assumption, I don’t know where it comes from, that if they flip a manufactured home when they go to resell it, that it won’t qualify for financing for the end buyer. And that’s just not the case. If it’s on a permanent foundation, deeded with the land as real property, it can qualify, as long as the buyer’s buying it as their primary residence, it can qualify for FHA, VA, conventional. And here I think in

May of 2025 actually even USDA is going to start funding manufactured homes as long as they’re 2006 or newer. Previously I think they only did them if they were new construction but that’s about to change and add some more buyer in buyers to that that retail pool if you will. So that’s part of it. Another part is just credibility and reputation. You know once I flipped a couple of them

John Harcar (15:42.648)
Huh.

John Harcar (15:57.86)
Yeah, yeah.

Jason Velie (16:04.482)
people at the local meetups started calling me the trailer king for some reason. so then people, right. So people start talking about it. And then anytime somebody comes across a trailer deal, like, you should, you should take that to Jason. You should go, you know, so then you just get word of mouth deals from agents or wholesalers and it just starts to snowball.

John Harcar (16:09.491)
It’s a cool nickname.

John Harcar (16:28.087)
Well, and I want to I want to focus on that for a quick second. I mean, especially the niche part, right? You know, when you when you are a master at something, people come to you for it. What are some of the pros and cons of flipping manufactured versus traditional single family?

Jason Velie (16:47.214)
The biggest pro is the lack of competition. The fact that there are more deals out there, and now this isn’t true in every market because there are plenty of markets that have almost no manufactured homes at all. And I feel bad for those folks, but most markets have plenty of them. And so that’s the number one thing because when there’s less competition, it means you can get more deals and usually higher margin.

John Harcar (17:02.563)
Hmm.

John Harcar (17:08.354)
Sure.

Jason Velie (17:16.824)
deals as well. that’s number one. Number two, they’re easy to work on. They’re very simple. know, lot of flippers and contractors are nervous about them at first. They think that they’re going to be tricky to work on. But in my opinion, they’re way easier. I mean, they’re so simple. I mean, I can have a licensed plumber replumb an entire double wide permitted for about four grand. You know, how much would that cost on a stick-built house?

John Harcar (17:23.927)
Mmm.

John Harcar (17:31.651)
Mm.

John Harcar (17:42.851)
Mmm.

Jason Velie (17:46.126)
You know, it’s just because, right, it’s just because they’re on, you know, usually big crawl spaces, they’re very easy to work on, there’s not that much to them.

John Harcar (17:46.197)
A lot more than four grand.

John Harcar (17:56.984)
Yeah, and a lot of these newer ones are super well built too.

Jason Velie (18:01.763)
Yeah.

John Harcar (18:04.929)
What are some trends that you’re seeing right now, whether it’s single family, whether it’s in manufactured or whatever it might be, what are some trends you think you’re seeing in the business or the industry right now?

Jason Velie (18:22.804)
Nothing in particular other than just how the market as a whole is doing. We have a, historically speaking, pretty hot market here. Wilmington has the last several years ranked number one for those studies that moving companies do when they tell the percentage of inbound versus outbound moves. Wilmington, North Carolina, even though we’re a pretty small, like under half a million total MSA,

John Harcar (18:42.154)
Mm-hmm.

Jason Velie (18:52.748)
We’ve been ranked number one in the entire country for the highest percentage of inbound moves for several years. And so there’s plenty of growth, but even in our market, even though we’re probably a little bit, you know, in a hotter market than other areas, the market to sell properties the last year, as with most places, has been ice cold. It has been very difficult. Luckily,

John Harcar (18:59.053)
Duh.

John Harcar (19:19.415)
Mmm.

Jason Velie (19:20.406)
We’ve seen some increase in activity in the last two months or so, a little bit more show-ins, a few more offers and contracts. Overall, it’s still pretty slow. Although rates have started to come down a little bit, we are starting to get into spring. So I’m really hoping between those two things, if rates keep coming down and as we get into spring, that some of these others that we’ve been sitting on for a little while trying to get sold will hopefully get some traction.

John Harcar (19:29.4)
huh.

John Harcar (19:50.518)
Yeah, and I think that’s a consensus all around the country. I know a lot of our folks, know, a lot of our group are the same way. Like they got so much out there just waiting for the good time to sell. Tell us about your team. What does your team look like? How are you finding your deals? know, volume you’re doing, those type of things.

Jason Velie (20:12.994)
Yes, so right now it’s me running the company and I have my dad working for me as a full-time project manager and I have a young former car salesman that is my full-time acquisitions manager. I’m also in the process of hiring a full-time virtual assistant that can help me with some of the transaction coordination on my purchases and some of the other, you know, just

John Harcar (20:22.179)
Cool.

Jason Velie (20:43.052)
data entry, bookkeeping, expense tracking kind of stuff. But so basically I pay for a bunch of online marketing, social media ads, PPC, SEO, et cetera. And when those leads come in, they go straight into our CRM and notify the acquisitions manager. He calls them, qualifies them over the phone, sets the appointment, goes to the appointment, gets the contract. Once he’s got a contract.

John Harcar (20:46.499)
Mm-hmm.

John Harcar (20:55.544)
Yep.

Jason Velie (21:11.404)
He passes it off to me. I line up the private lender and get it to close, make sure that the seller signs what they need to, which is some of the TC stuff that the VA could help me with. And then once it’s closed, I pass it off to my dad who then meets the contractor out there and they talk about what needs to be done and what the budget is. And then contractor gets it done. My dad makes sure that

John Harcar (21:23.533)
Yep.

Jason Velie (21:39.958)
All the work is done. There’s no punchless items left. The property’s been cleaned. And once it’s fully ready, he lets me know once it’s ready for photos. And then I reach out to the realtor who will then schedule the photos and get it listed. So a lot of times I don’t even see the properties that we buy anymore. And, you know, it’s because I have people that I can trust and not only on the front end on the purchase, but also on the back end.

John Harcar (21:42.989)
Mm-hmm.

John Harcar (21:59.62)
Perfect.

Jason Velie (22:08.75)
finishing the rehab, making sure things are list ready. Volume wise, we’re doing around 50. We may even do 60 this year. I’d say on average about half of my deals are sourced from wholesalers and the other half are sourced from my own marketing. One reason why that hasn’t changed

John Harcar (22:19.657)
cool cut.

John Harcar (22:30.371)
Okay.

Jason Velie (22:36.268)
those percentages as I’ve spent more and more money on marketing and gotten more deals myself is because more and more wholesalers keep coming to me. And part of the reason for that is the level of volume that I’ve been doing. know, if you want to reference back to the snowball effect of things, because I have done as many flips as I have over the years, when wholesalers that are out of state get some random one-off deal in our area,

John Harcar (22:50.095)
huh.

Jason Velie (23:05.175)
they’re going to go on places like Investor Lift or PropStream, places like that to try to find real cash buyers. And if you’re a real cash buyer and you’ve been doing a lot of transactions, those softwares, they read all that public data and they will give you a certain score or number of points based off of how many deals you’ve done in a certain number of time.

and they will recommend you as one of the potential top cash buyers in a particular area. so just because of the work that I’ve done over the last few years, that’s now helping me get more deals from random wholesalers that I’ve never met before. It’s pretty awesome.

John Harcar (23:35.959)
Nice.

John Harcar (23:47.844)
That’s awesome. If someone’s wanting to get into the business and start doing stuff and being what you’re doing, what kind of advice or what kind of tips would you give them as you’re getting started?

Jason Velie (23:59.982)
Yeah, for sure. I would say, you know, first of all, don’t get stuck in just consuming education. Like you need to learn what you’re doing, but the most important thing is that you take action. It’s fine if you don’t know what you’re doing completely initially. The second thing is definitely make sure that at least your first property or two

you take somebody with you to look at it that has some experience, whether it’s an experienced flipper or a contractor or a home inspector, you know, because a lot of times when we’re buying these off market direct to seller, part of our great offer is we’re not going to send a home inspector or septic inspector or a termite inspector. We’re going to take on all those risks, you know, so if that’s the model that you’re choosing to do, you’re offering that type of ease to these sellers.

John Harcar (24:44.887)
Right.

Jason Velie (24:52.034)
then you really need to make sure you know what you’re looking at or else you could think a property only needs $20,000 worth of work, but somebody else with experience could have easily told you it’s gonna need 50. So get somebody, whether it’s a mentor or just somebody willing to help, or even if you have to offer an investor a deal to potentially wholesale it to them first, just for you to be able to get the experience and the education.

John Harcar (25:04.419)
Mm-hmm.

Jason Velie (25:20.97)
and some credibility, it’s worth it. Even if you had to assign a contract for no assignment fee, even if you had to do it for free, the information that you would learn and the relationship that you would make with that person would be worth infinitely more than you would ever get from that one assignment fee.

John Harcar (25:22.499)
Yeah.

John Harcar (25:38.723)
100 % man that and I think that is probably one of the best the biggest nuggets that I get from a lot of people is that you know when you guys are getting into it Find someone that’s been there They’ve been there. They’ve walked through it. They’ve been in your shoes now. They’re where you want to be That’s the kind of person you want to guide so man I appreciate Jason all the stuff you’ve all the info you’ve shared with us man I mean I know a lot of our guys probably got a lot of good tips listening to this if Folks want to get a hold of you and they want to pick your brain some more maybe they’re in your market

and they want to do some business with you, how do they get in touch?

Jason Velie (26:12.376)
Yeah, absolutely. They can find me personally on Facebook or Instagram. They can also go to my website, is capetheer.com. That’s C-A-P-E-F-E-A-R cashoffer.com. I’m also on LinkedIn, although I don’t use it very much. I also am on BiggerPockets, even though their platform kind of sucks, to be honest. But it…

John Harcar (26:39.363)
Yeah

Jason Velie (26:40.622)
I’m around and if you want to see other videos from other podcasts I’ve been guests on, some of them dive into specific on Flippy Manufactured Homes really getting into the weeds. If you just search my name on YouTube, you’ll find some other content there as well.

John Harcar (26:54.692)
huh.

John Harcar (26:59.585)
Well, I know a lot of folks don’t know much about mobile home flipping and their manufacturing flipping and maybe that’s what they want to learn. guys, once again, I hope you guys took some good notes. We had some great nuggets here. Jason, thank you again for your time and I hope everybody enjoyed the show. See you on the next episode.

Jason Velie (27:16.088)
Yeah man, thanks for having me.