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Author Topic: help estimating my rehab's  (Read 5598 times)

Offline Don_NC

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help estimating my rehab's
« on: November 21, 2004, 06:07:50 pm »
Hey all!

I hope that you all can give me some more ideas on estimating the as-is value of a house. Do all tax collecters list the estimated market value as part of a public record? And if so, is that pretty accurate?
I'm gearing up to call possible sellers and lay out some offers, I understand if i'm not embaraced when I give an offer then it's too high, but, I just want to make sure it's not rediculously low either.

Thanks for any help you can offer!

Don  :)
« Last Edit: November 21, 2004, 09:10:25 pm by Don_NC »

Offline Don_NC

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Re:help estimating my rehab's
« Reply #1 on: November 22, 2004, 06:56:31 pm »
nothing?

If you can point me in the direction of a book/resource that will answer my question I would be appreciative!

Thanks!

Offline reslynn

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Re:help estimating my rehab's
« Reply #2 on: November 29, 2004, 01:06:18 am »
If you're referring to the appraised value done by the assessor's office, to me it's not an accurate figure to base value.  It's even mostly under valued.  I have even seen some inexperienced folks in selling tbeir properties basing solely by cost per square foot.  They are used by appraisal but I wont get too bogged down by those figures.

What I have used in basing as-is value is doing a CMA (comparative market analysis).  Its not very accurate either but what it gives me is the ball park market value of a certain property that Im interested to buy.  Your local realtor would be your best resources to have a CMA.

Most seasoned real estate investor used 80% of market value in buying properties that need some rehab work.  That could even be more or less than 80% depending on the condition and amount of repair work you have to make.

Home s Foreclosures Investing - Step-by-step process in  buying a home foreclosures for quick cash.

Offline garrej

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Re:help estimating my rehab's
« Reply #3 on: November 29, 2004, 07:31:51 pm »
You need to gather lots of information and know your market.  Never make an offer you can't complete.  I tend to buy houses .30 to .50 on the dollar.  The last one I bought was $2500 much lower than the asking price of $27,000.  You must be able to understand the seller more than the house.  She wanted to sell and I knew it.  All I did was offer her a quick and easy way out.  I told her to go home and all the mess for me to clean up, she only needed to come back to sign the paperwork.

The previous house was $28,000 down from $36,000 because he told me how much he would come down because I listen to him talk for about an hour.  The house was already under valued, that was why I was talking to him.  Find people that want to sell - - not houses for sale.

Offline Mr.fancypants

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Re:help estimating my rehab's
« Reply #4 on: December 09, 2004, 04:24:09 am »
Hi Don_NC,

I was just responding to your inquiry about property valuation. When I first started I got burned a couple times because I was basing all of my numbers solely on the tax appraisal of the house. Sometimes it would be high, sometimes low. I still rely heavily on the tax appraisal, but have since learned to go by the comps instead. What the previous person posted is also correct, you have to know your market. An incredible website to use, but only if you're super serious, is Sitex.com. For $70 a month you can get very detailed comps for virtually any property. I have a friend who is a high volume appraisor and he uses this site. I subscribed for 2 months and then just started relying on my realtor providing comps and CMA's. It's free that way. Good luck.

Chris Humston
« Last Edit: December 09, 2004, 08:36:26 am by TRandle »
Work smarter, not harder!!!

Offline eve_32

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Re:help estimating my rehab's
« Reply #5 on: December 09, 2004, 08:31:38 am »
On one of the Carlton Sheets tapes that I have he says that an offer is too high if you are not embarassed by it. All they can do is counter your offer or say no it is too low and then you bring it up. If you start high you can never go down so keep that in mind.  I just started investing recently but I have worked in RE sales for 10 years so when I made my first offer I was so embarassed I just knew they were going to turn it down. I purchased it from a municipality and they just said make an offer. The house needed very little work less than $5k. My partner said to offer $1500.00 I offered $2000.00. They accepted it immediately because they didn't want the headache of keeping up the properties that they had. So don't let the embarassment of the offer make you pay more than you need to pay! The fmv of the house was $82k.

Offline garrej

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Re:help estimating my rehab's
« Reply #6 on: December 17, 2004, 04:02:44 pm »
I have to agree making low offers is how I find my best deal.  My web site has a link for people to offer me their houses.  I had a lady send me an email and she wanted $27,500 for a house she inherited from her mother.  She said it had a tax evaluation in the 30’s.  I knew it was not worth to much so I was not that interested.  She called me and asked me to meet her and I agreed.  After listening to her for 20-30 minutes I offered her $2500.00.  When she got mad I just spoke calmly and explained how she could save herself all the headaches involved with getting rid of it.  I said, “Just turn over all the headaches to me” and I would clean it out and she did not have to deal with anything.  She sold me that house for $2500.00 I never have to trick or deceive anyone to find great deals.  Never get mad if they get angry, just speak calmly and negotiate.  I am never embarrassed, I have the cash and can do the deal quickly and that is what they want the most.

Offline ladyb

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Re:help estimating my rehab's
« Reply #7 on: December 29, 2004, 12:15:46 pm »
message to reslynn:

I'm a realtor that is also an investor.  Do YOU think you should USE a realtor's time and expertise for FREE to get your CMA's?  If its FREE, what do you think its worth?  

As any other businessperson, I don't want my time wasted by people who have no intention of using my services, only FREELOADING off of my expertise that I have spent precious time learning and thousands of dollars maintaining!  Just as you don't want "unmotivated" buyers and sellers wasting your time as an investor, we realtors don't want investors wasting our time providing our expertise for FREE.  Learn how to do your own CMA, but don't freeload on the backs of realtors.  We work 7 days a week, often 18 hours daily, have expenses that would make you cry and get taken advantage of often.  Get a reciprocal relationship with a realtor and treat them with the same respect that you wanted to be treated with!

Ladyb
« Last Edit: December 29, 2004, 02:11:29 pm by ladyb »

Offline Paul the Broker

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Re:help estimating my rehab's
« Reply #8 on: December 29, 2004, 08:42:37 pm »
Geeezo ladyb,

I know that there are far too many people out there that take advantage of us, but reslynn did not apear to be advocating that someone waste your time. I'm quite certain that I have at least as many or more knife scars in my back as you. It's really just a numbers game, the more people you help, the more you sell and unfortunitly the more people who will turn their back on you. I guess my point is that you shouldn't be so quick to judge someone who turns to you in need of your expert advice. Please don't take this the wrong way, I saw your other post and thought it was very insightful and shows just what type of information and services we can provide. Sooner or later chances are they will need a Realtor and it's not a bad idea to be thought of when that happens. Happy New Year and Peace.      

Offline garrej

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Re:help estimating my rehab's
« Reply #9 on: December 30, 2004, 02:32:54 pm »
I am a professional investor and use my agent many times.  A good agent will never feel as though they are wasting time as long as you treat them right; a real estate agent that waste time is too new... or too old...  Real agents make business, they don't wait for it.

If I make an offer through an agent I tell them my agents name and say she represents my interest and she collects a paycheck just because she is so helpful when I need her help.  

My little way of saying "Thank You" for all the times she helped and did not get a commission.

« Last Edit: December 30, 2004, 02:34:17 pm by garrej »

Offline Mr.fancypants

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Re:help estimating my rehab's
« Reply #10 on: December 31, 2004, 08:57:19 pm »
Sorry about any confusion or anger my previous post may have caused to ladyb or PaultheBroker. That wasn't my goal. I think your responses were meant to be directed at me instead of reslynn? Anyways, I want to clear the air by saying that I love my Realtor and that her and I have a tight partnership. Her services are much appreciated and I try to make her feel that way. The reason I said that she gives me comps and CMA for "free" is because whenever she does, we enter into an informal contract of etiquette whereby I use her to make my offer, therefore she gets 3% of the original sale price. Then I use her to relist the house after I rehab it and she gets 6%. It's a win/win. I make money and she makes money. This is the type of relationship Realtors and investors should have. I depend on her expertise to provide me with good data so that I can make money and she depends on my initiative to buy a lot of houses so that she can make money. Peace out and happy new year.
Work smarter, not harder!!!

 




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