Ep. 40: Renovating Flooded Homes and Out-of-State Apartments with Jason and Pili Yarusi

Most investors would never even think of investing in flooded homes, but not Jason and Pili Yarusi. This real estate power couple began flipping these flooded homes and raising the 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 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 and used the team they had in place
• 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, do what’s boring on markets

Daily Habit: Pili – time blocking and doing her one thing; Jason – meditation

Resources:

FEMA 

Miracle Morning by Hal Elrod 

Best Business Books:

Never Split the Difference by Chris Voss   12 Week Year by Brian Moran

Digital Resources

Slack 

G-Suite   

Tweet This:

“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:

Ferraro’s 

Connect with Jason and Pili:

YarusiHoldings.com

Pili@YarusiHoldings.com

Jason@YarusiHoldings.com

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