Help Me Make sense of This

Owners/Sellers always price there property really high just to take a chance that someone will grab it. But as a REI armed with Dean's teachings we always know that this happens each and every transaction that we're dealing especially if the owner is not really that motivated. In this case, try other options like running the comparables in the area at least sales in the year 2010 in a 1 mile Radius from where the subject property is located. You can start from there. Blessings to all. LA

Thanks. I'll start there as you say. I see my realtor early in the week so I'll take your advice. I love the website!

Ogal

Are almost ALWAYS over priced because the sellers know that they are investment propertys & try to squeeze every dollar they can out of them so do the comps & don't pay too much so that it can have a nice cash flow while you own it

Ogal,

I don't know much about the property you're looking or whether you've already moved in one direction or another but I will tell you that you cannot take that the asking price of any property is what it's really worth. If you are looking for a cash flow property and this is your first dip into the pool of being a landlord the best advice I can give you is to do your due diligence. Find out everything you can about the "business" of that property i.e. mortgage payment, interest rate, balance, renters, lease terms, maintenance, utilities, taxes, insurance, last 6 months (actives, listed, and most important SOLDS). That is the basis of whether it a deal worth pursuing, if the numbers work, do it, if they don't don't do it. It's really that simple, the last thing you want to do is buy a property just to say you're a real estate investor if it isn't going to provide a positive cash flow. Talk to the seller about buying it from on contract and if you have the $$ offer to pay his expenses to make his move to FL. Obviously the seller is an investor himself, he should be open to selling you the property on a contract (if the terms and balance of the loan on the property make sense (i.e. you don't want to agree on a purchase price significantly greater than the current value of the property which you determined from your comps) And I absolutely recommend that you go and look at the property and determine what if any repairs, upgrades, add-ons are needed on the property to make it rentable. Once you calculate the costs of the "fix-ups" you deduct that from your offering price and negotiate from there. Good luck!

Michael

Thanks for your advice. I will be meeting the owner later in the week to walk through the property. I KNOW I won't offer full price no matter what. But I didn't know I had the right to ask to see all the info about the property. I appreciate all you've said and I'll keep you posted.

Ogal

Hello Ogal, I've been out pursuing things here in Idaho and haven't been on the site in a while. How did your walkthrough and negotitation with the seller of the duplex go?

Don't get discouraged, I'm a newer investor as well. You just have to keep looking, doing your homework and a deal will present itself. After that, you just have to find the courage to pull the trigger on it. Best of luck.

Michael

I strongly suggest you drive by the property and in the area as much as possible and at different points of time to gauge the personality of the nabe; is it quiet during the day and loud at night??? Vice versa??? Is there alot of foot traffic??? if so who and what age group or type??? is it near transportation, schools, what type of businesses are in area???

Go with the frame of mind that you will have the answers and questions and knowledge to force them to lower their price; "I drove by around 11pm and across the street were this loud group of kids. Have the tenants ever complained to you???"

Also gather your knowledge so that if you want to flip it, you can provide all the relevent info that any prospective buyer would need to have;

"there's new shops in the area/a baptist and catholic church down the block/block association on this street/firehouse two blocks away/police preceint around the corner/State College is only a 10 minute bus ride away on the 25 up the street/great daycare that was featured in the paper two months ago/etc., etc"

Give a potential buyer no reason to say no and if they do, make it so they regret it and come back in shame begging to take the place

Hope this helps

I'm new myself. I'm glad you stepped out there, congrats! I'm working on getting my team together. Try getting comps from 3 different agents for the Sold prices, Look at the property for fix-ups- if you don't have a contractor to tell you the cost of a repair, at Home Depot or Lowe's you can at least ballpark the supplies or call contractor's for costs for a fix. I'm so excited for you! Make sure the Numbers work for you First! That way you will know if it's Truly a good deal and if it's worth your time.

Hang in there, Success is Yours!
Tori

Tori, I appreciate the encouragement. That is what I like best about this site. Everyone is pulling for everyone else. I don't have to scrutinize the comments to figure out the writer's angle. DG family doesn't want anything but for me to succeed! BTW, that deal didn't work out but I am keeping an eye on it and I am sure we'll be talking again.

I hope things are going well with your team building. Right now I am mailing to expired listings and so far I am getting a response that is pretty much like Matt Larson said. Every 25 letters pulls in 2 or 3 responses. I am meeting with selleers next week to see if we can move forward on anything, but I am excited!! Take care and profit large!!

Ogal