This is what I’ve got. My realtor called me yesterday, have a house scheduled for foreclosure sale on May 2nd. The borrower called yesterday to list it and she called me before she puts it on MLS. The house will sell for minimum $750,000 and max $780,000. Assesses at $780,000. The house is in the most desirable area of houston, built in 2003 and barely lived in. 4,267 sq feet, 4 BR 3.5 baths. The borrower took out the mortgage in Sept of 2004 and is only looking to pay that off with no profit. In fact, he’s putting $10,000 into it to get out from under it. I have backed out the realtor 5% commission so the profit listed above is at the minimum sales price of $750,000 so that is the minimum profit. The house needs no work. I am trying to establish a network of buyers as I have several deals in the works.
Like I said, it goes to foreclosure sale on the 2nd of May. Texas holds auctions on the first Tuesday of the month. Let me know what you need. Title, appraisal, inspection, etc and I will order it and get it moving. Please let me know if you’re interested.
Not intending to burst bubbles, but from the figures posted, your actual profit would be closer to about $15-20K, not $85K and that’s assuming that you have no closing costs when you buy.
The original post already has holding costs and realtor commissions backed out. The sales price will be around $780,000-800,000. With the 5% realtor commissions of $40,000 already backed out and an estimated maketing time of 30-60 days max in this market which I am very familiar with. I’ve withheld $20,000 holding costs and est closing costs of 3% which is overestimating it. This leaves a minimum profit based on a $790,000 sales price of $96,600, not $15-20k. We are purchasing the property for $610,000. Using your figures of 6%, 3% and no holding costs you come out to $76,000 so I don’t see how you’ve calculated your figures.
If this is considered advertisement, I apologize, I thought that was the point to this area of the forum.
I did not delete the original post. I like the discussion about how to figure the profit on the deal. I did remove the contact me via email which is a violation and in fact the entire post is a violation. If we learn from the discussions then it is a teaching tool. If other moderators disagree then it will be deleted along with this post.