OfflineHi,
I was wondering if anyone can comment on my first potential deal. I have not yet provided an offer to the seller.
Prop is selling for 208K and it needs about 25K of repairs. When I went to the bank for financing the bank estimated the house to be 258K. My intent is to offer full price and have the seller pay 22K in closing. My question is what other techniques I can use to restructure the deal that could sound attractive to the seller?
The city assessed the prop at 247K. The average sell price in the area is 259K.
What other things should I be considering? As you can see I am sensitive to this deal since is my first one. I really would like to buy without the need to use a lot of my own money and find out what should be my maximum offer before I walk away.
Thanks,
Richard.
This deal worries me a bit. If you pay full asking price and the seller pays closing costs, you still have $25K in repairs plus seller commisions. That right there puts you at $248K. If the rehab takes 2 months (figure high) and selling it takes 3 months (probably average) then that is 5 months with a mortgage which is about $10K, then your total investment is around $258K and the average sell price is $259. That is break even. What if something goes wrong? If it were me I would either walk away or put in an offer that will give you a solid profit. Maybe offer something like $145,000 less 6%. All they can say to that is no or yes-either way you win. Investing in real estate should be systematic and unemotional. Good luck!
You've got to find your obstacles and call them out! Unsheath the sword, and do battle with whatever it is that holds you back!
Neither the seller nor I have a real estate agent. Should I consider using one to make the offer? I am aware of the 3% commission that I will have to pay by using the agent but is it best to use the agent for negotiations? When should I use an agent in a real estate transaction?
Thank you so much for the inputs.
I would walk away from that deal ynegron, there isn't enough profit @ those numbers in your first posting.Even if you don't use an agent,this deal has no good written all over it.I hate to be negative but, it's the truth.Get out of this deal while you still can.
YOUR HERO, SULLY
I will offer the seller a max of 150K. If I don't get it I am walking.
Thank you guys for providing inputs. I am newbie on this and need as much help I can get.
Interested on how you made out . Let us know what happends!!