OfflineI'm looking for a new property to buy and fix and flip. I saw a property today and I analyzed the deal and I have my maximum offer price. It is below what the wholesaler is even asking for.
I doubt the house is going to sell for what they're asking. However, the house is in need of complete reconfiguration (garage, kitchen, entrance, rooms, bathrooms) and almost everything is missing in the house.
I'm estimating a 70k amount for the fix up. I'm wondering if I will even consider it if they accept my offer.
Question is: if you're not too excited about a house but the numbers work (the area is a bit sketchy), would you still go for it?
Thanks for your feedback,
Sam
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If the area is "sketchy" my answer is "no."
(Even if the investment is short term). When in doubt, don't do it.
A deal is only a deal to me when ALL of it suits my criteria.
Wholesalers sh/be selling properties for dirt cheap, leaving the equity capture for their end buyer investor, albeit, flip or hold.
If a property is priced too high, needs a ton of work, and the neighborhood is in doubt, to me this would be 3 red flags.
(The ARV not mentioned, hard to conclude, otherwise).
Are you wanting to buy in YOUR target neighborhood or that of the your wholesaler?
Stick to your criteria and YOUR investing model. Look at properties within those parameters.
There are plenty of properties out there! Don't just buy to buy. Think in terms of business decision-making. Find one where the numbers work and its' prospectus excites you! You'll know the "gem" when it presents itself.
PS. "Weird" or "funky" or "functionally-obsolescent" houses often require significant rehab/remodeling dollars. Beware of true resale value or salability if updates are not performed. Objective is to make money, not lose it.
Happy Prospering! ~Kat, Liberty Residential Investment Acquisitions
• "To every thing there is a season, & a time to every purpose..." ~Ecclesiastes 3:1-8
• "Inaction breeds doubt and fear. Action breeds confidence and courage. If you want to conquer fear, do not sit home and think about it. Go out and get busy!" ~Dale Carnegie
• "Begin, be bold, and venture to be wise." ~Horace
• "Never, never, never give up." ~Winston Churchill
• "Whatever you do, or dream you can, begin it. Boldness has genius and power and magic in it." ~Johann Wolfgang von Goethe
Why aren't you excited about this one? Is it the neighborhood, the property, the needed repairs, or all 3?
You should find out more about this house just for your own experience and market data, but if the opportunity to profit from this place doesn't keep you up at night, shout "NEXT!" and move on to one that does.
If it sounds too good to be true, it probably is. If it sounds too difficult to be worth doing, it probably is. Make sure there's profit in a deal before pulling the trigger, not because you want to go through with it. Just that alone will save you from alot of expensive mistakes. Best of luck to you...
Paul: "I must not fear. Fear is the mind-killer. Fear is the little-death that brings total obliteration. I will face my fear. I will permit it to pass over me and through me. And when my fear is gone I will turn and face fear's path, and only I will remain."
Duke Leto: "I'll miss the sea, but a person needs new experiences. They jar something deep inside, allowing him to grow. Without change something sleeps inside us, and seldom awakens. The sleeper must awaken." - "Dune."
however it appeared to have the promise of being able to be a commercial site. Upon further investigation it would mean that I would have to get the neighbors to all agree to commercial zoning, and that is when I deemed it sketchy and passed. The house was misconfigured and old and also had another house on the lot, so it came with too many problems to make it viable. Go with your gut; if it is sketchy then pass.
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.
Thanks guys. These tips were very helpful. I passed on the deal.
Sam