Buying 50 cents on the dollar?

Rehabbing, Fix and Flip, Rental Properties
1

Hello all!

Can someone please explain what buying 50 cents on the dollar means?

Does it mean to buy a 100,000 house for 50,000?

or 35 cents on the dollar would be 35,000 for a 100,000 house?

Please Help!..Thank YOU all!!!

2

BINGO!!..Actually, it’s more commonly thought of as buying at 50% of the ARV (after repair value) less expenses…So if your $100,000 house needs $15,000 in repairs to bring it up to the $100,000 value, you’d pay 50% x $100,000 less $15,000 needed for repairs = $35,000…

3

Isn’t it really really really hard to find houses that are 40-50% of the market value?

I look at the newspaper every day and I see houses for 40,000 all the time, but I couldnt imagine them going down to like 15,000.

4

hoosier, they WILL go down that far eventually . you have to find a motivated(desperate) seller.
in other words , a serious “i dont wanter” like for example;
someone who is making 2 different house payments or someone who has a sudden need for money NOW !! there are lots of reasons that make up motivation. it’s a numbers game. if you make enough offers eventually one will be accepted & you’ll be on your way. you don’t
have to be 18 if you have a parent to sign your deals. just take your time & do your due diligence(make sure the comps are good & you buy low enough to allow for your profit).

5

…Isn’t it really really really hard to find houses that are 40-50% of the market value?..

Yeah, no kidding. That’s why you have to work at it to find them. They aren’t going to appear on your doorstep in a basket with a red ribbon tied to the handle. You have to go out and hunt them down.

I’m not attempting to discourage you. People do find those houses and buy them. If they can do it, you can do it. But it it’s a little more effort than buying French Fries at the drive through.

You are studying now and that to me means that you are seriously interested.

Some advice that will help ypu a great deal. Start right now protecting your credit. Your credit score will be your most valuable asset if you want to invest in real estate.

6

Oh the credit score! Great point tatertot. If I would have only known then what I know now…