Deal or no deal?

Deal or no deal?

I have a home in the nice part of town that is valued at

appraised in 2012 at 808,900
last sold 2008 679,000
realtor comps today 695,000

Asking 499,900
I offered 410,900
counter 450,000 with $1000 EM

4 bed 3.5 baths restored nice home. Thinking to offer 425,000 which would be about 61% of 695 realtor comps. Thoughts? Would this home sell fast to an investor or is it hard to tell from these numbers? Thanks for any help!

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Tammy

doing quick #'s, ARV 695k -10% transactional costs is $625,500 -rehab is actually i noticed you didnt put rehab amount-this is important so find out your best questimate you should know by looking at pics or giong to see it. If rehab is 100k for example tho then 625k -100k puts you at 525k & also -your fee say 20k that puts you at 505k, so if you get it at 425k then your end buyer would make 80k so that is a good deal.

this hinges on the rehab & I use 10% transactional costs because matt or somebody was talking about that on a webinar maybe Nate Armstrong that you can use 10% these days for transactional costs you know realtor costt 6% closing costs 3% & holding costs normally 4%. But because a lot of people are using just plain cash & not borrowing it to fix n flip then you can just do 10% costs. So find out let me know. Does that make sense? hope so Smiling

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Tony

Go faster do more! GFDM!


Tony

Thank you for the feedback. The house could go as is, but for the area, maybe simple updates 25 to 50K would be good! I suppose one could go much higher end for 100K and I was only going to do a 10K fee, so I guess that would still be good to go then.

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Countering

Are you wanting to wholesale this property? What are the repair costs? There are buyers for just about anything these days. As long as they're countering, keep going until you're close to your max or right at it. I'd go up $2k or $3k each time, until they stop negotiating.

femailceo wrote:
I have a home in the nice part of town that is valued at

appraised in 2012 at 808,900
last sold 2008 679,000
realtor comps today 695,000

Asking 499,900
I offered 410,900
counter 450,000 with $1000 EM

4 bed 3.5 baths restored nice home. Thinking to offer 425,000 which would be about 61% of 695 realtor comps. Thoughts? Would this home sell fast to an investor or is it hard to tell from these numbers? Thanks for any help!


Yea Tammy pull the trigger

If hardly any rehab oh my gosh yea by all means counter at the amount you said 425k & say you can close in 2 wks! That is a prop dollar amount like So Cal so you have to treat it like that. BTW where are you again? So Cal?

I would counter like now tonight, make sure the comps are solid tho, double check, get 2 sets of comps fr 2 diff realtors plus your own checking on Zillow prop trend etc but comp them out out dont just take the value you follow? Make sure comps are within half a mile or a mile not over main roads or highways or big landmarks ok & are within 20% + or - of sq footage similar age similar lot size same type of hm style of hm i mean & same bed/bath ok.

Sounds like a winner just make sure on value, does it have a view etc. Also do you have buyers? Send it to them now without the address & see if they are int with your #'s you have now, tell them you want them to pay the emd if that will strap you with cash ok. God bless

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Tony

Go faster do more! GFDM!


Repair cost?

What are the repair cost? Once you know if the property needs repairs and how much, then you will know if you have a good deal in your hands. Also if your flipping the property or wholesaling it you shouldn't go by the appraised value, you should be just focusing on the recent sales (comps) for your ARV.

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Reynold Orozco


What are your plans with the

What are your plans with the house? I see you added that there would be minimal repairs needed. Have you viewed it personally or had a contractor walk it? Where is it located? I get $436,500 would be 70%ARV minus $50k in updates/repairs...so subtract what your fee would be from there and wolla Eye-wink

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Lenee

www.allstarhouses.com

~Act successful! And you'll draw it to you.~
~Every achievement, big or small, begins in your mind. It starts as a thought.~


Target houses in the

BEST selling price range for the area. You'll have MORE buyers and should sell FAST..

PPl will buy any price house,BUT, really how many ppl are buying THAT price range?(less buyers)

How many ppl buy 1 million dollar houses?

As long as you have a buyer all is well.

@ $80k profit to investor buyer is less than 20% ROI on $425k

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Mike
https://tvallc.isrefer.com/go/RehabLite/renvestr/ Free tools


Thank you Tony, Lenee, and Reynolds and Dallas

for your help. I am able to do a walk though later today or tomorrow, just waiting to see which time and I will let you know. Apparently it just needs a few updates and they want to sell fast. Having a local experienced investor help me on this deal since he has 20+ years experience. Local REI clubs are great for meeting seasoned investors who truly know what they are doing. I am still learning; guess we are always learning though!

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www.tw4homes.com website
https://tvallc.isrefer.com/go/RehabLite/reigirl/ FREE SOFTWARE FOR WHOLESALERS, REHABBERS AND AGENTS! Present professional looking deals to buyers and lenders as well as run your numbers and get the ROI.


work it

Hi Tammy hang in there and do as everyone suggests, Mike has a good point, stay with it as long as it shows a good deal,they countered thats good to! Due the numbers and what ever fixup cost, you have some help with another investor thats a plus to,when we dont quit good things always come, much success, Jim

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jbischoff


Tammy

it's irrelevant what we think... it's what your buyers want. Do you have a buyers list? What do they want? that's your answer...

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Valerie

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Well the good news is

I found a money partner from today, so I am happy! Thank you all for your help!

__________________

www.tw4homes.com website
https://tvallc.isrefer.com/go/RehabLite/reigirl/ FREE SOFTWARE FOR WHOLESALERS, REHABBERS AND AGENTS! Present professional looking deals to buyers and lenders as well as run your numbers and get the ROI.


Oh I forgot

although he was interested in this house the pictures appeared to be doctored, or photo-shopped, so when we walked the house it had been probably redone in the 70's and although it had good bones, to bring it to surrounding standards would take 100K at least, but the time needed combined made it one we had to pass on.

__________________

www.tw4homes.com website
https://tvallc.isrefer.com/go/RehabLite/reigirl/ FREE SOFTWARE FOR WHOLESALERS, REHABBERS AND AGENTS! Present professional looking deals to buyers and lenders as well as run your numbers and get the ROI.


more rehab cost

As long as you have a buyer all is well.

@ $80k profit to investor buyer is less than 20% ROI on $425k

__________________

Mike
https://tvallc.isrefer.com/go/RehabLite/renvestr/ Free tools


Tammy

Glad to hear you walked the place. I see this all the time. Listed for $499,900. Worth $695,000. No work needed! Or very little. I always ask how come it is not selling at $499,900? How do you think you could sell it for $695,000 if it is not selling for $499,900 now? How are you or your investor/buyer going to sell this house to an owner/occupant with only $20,000 in improvements for $695,000?

This math does not work! Gain $195,000 in equity from a $20,000 rehab? Now you will know this before you even walk the place next time.

Now if this was an UNLISTED motivated seller that just wants out than it could be a possibility, but a MLS listed property that is not selling, true value is being controlled by the current MARKETPLACE.

The marketplace in this instance is telling us that this place is not worth $499,900 as it sits. (no one is buying the place) and you will have to do some serious remodel/rehab to bring the estimate ARV of $695,000. Which you discovered when you walked the place.

So here are the numbers as a investor buyer sees them. (providing your numbers are accurate)

ARV $695,000 backed up by GOOD comps.

Subtract

Rehab/remodel $100,000
Selling costs/money costs $69,500
Holding costs (90 day) $20,000
Purchase price including your fee $435,000
Do a single closing, either assign or sell the LLC or Trust. NO money costs for you!

$70,500 net profit to your buyer! 15% ROI. I base this on OUT OF POCKET expenses for your investor/buyer. ($555,000) Commissions/closing costs are not out of pocket, they come off the sales price at closing.

I would put this place under contract in a flash and send it out to my list. If it does not work for you, WHOLESALE it!!!! One thing I have learned is one man's garbage is another mans gold. Get it, try and wholesale it and if you can't do it terminate during inspection!

I would say the last 4 or 5 wholesales I have done made no sense to me at all! HOWEVER I sold them to investors that looked at things differently than I did! They were OK with 12%!!

My theory is get everything I can under contract and TRY and wholesale it if I don't want it myself. Don't wait for what I think is a great/perfect deal. Some investors will take 10%!! Continually build your buyers list!!!

You will be surprised how your buyers list and your power team will grow when you are actually trying to sell properties! Much less how your systems and ability to evaluate will become much more efficient and streamlined.

A deal like this one will sell in about two hours here in Denver. Smart, capable fix/flip investors LOVE a $100,000 rehab. That's how they build value and get that ARV!!

Good Luck and glad to see you taking action!
Michael

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Great evaluation Michael!

I could have used that expertise before I got my first property under contract. Now I'm still in the 30 day period and can't find a buyer. It simply doesn't make sense on the ROI

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