We have been driving and driving and driving!! We found good houses to flip, but then the value of the house would be more then the prices in the neighborhood. The other houses are right in line with the flip houses, before flipping the house.
My question is… Lets say I wan’t to spend $60,000 and sell the house for $90,000. The average house on the street goes for $70,000. Could I really sell that house for $90,000. I’m approved for a loan and ready to go.
You can only sell a home for as much as what the buyer is willing to pay. So if homes of that size and type are selling ofr 70K, you have to be in that area to sell, usually. You have to consider other factors like size of the home, location, quality, neighborhood and things like that. Ask yourself this, would I pay 90K for a home where all the others sell for 70K?
I agree with you 100%. How do I find the house that sells 30,000 less?
That’s your job, you will have find a motivated seller/REO/HUD. Also, usually, the farther from FMV, usually the more work involved. You have to factor in repairs and holding costs. Realtor fees if you want to sell through a Realtor, property taxes, things like that. Do research, research is the key, and when you feel you researched it enough, do some more! Also don’t buy for the sake of buying, their will always be Real Estate to buy. Do a deal you feel comfortable doing, if you feel it isn’t right, don’t do it. Follow a budget.
How do I research? I’ve been pulling the tax appraisals for the particular street the house is one. I’ve also been looking on home search sites, to see what the houses in that neighborhood go for. Is there a trend report that I can buy?
What you want is somebody that will sell you their house for not much more than they have left on the loan. That means that you are looking for someone that is about to go into forclosure. That is where yiou get the best price. You can place bandit signs around the area you ar interested in that says Stop Forclosure, call me. There are several tests you can use to make sure you get some calls. The people that call these numbers can be ready to sell cheap.
Once you have identified a property that is diestressed, do the same checking you did before. Hopefully you have a guy in that $70k neighborhood that will sell to you for $50k plus some moving money. You can put $10k in the house and flip it for $70 and make $8k after holding costs of $2.
Spend more time writing contracts and less time driving! I never look at a house until they have accepted my offer!
Hope this helps!
Bluemoon06
If the house is 70 K, do I offer them $50 when they call? I’m the bandit sign queen, I’m presently in Apartment Property Management and “miss” marketing. I can’t believe I did’nt think of this!
Are your serious about doing this as an income? First, I would look into Lis Penden properties.(Pre Foreclosure) by the time it hits the sheriff sale some of these properties have other liens, etc…or are max out for what they are worth. Second look at the house and see if it needs any work before flipping it, that will play a part in your profit. Third get a CMA of the last house sold in the pasted 6 months and what is currently on the market on the same street or town. And last leave 5-6% for commission. Sometime listing with a Realtor will sell your investment faster and net the maximum amount for you. So you can move to the next one.
I am totally serious about this. Could you tell me where I would find “Liz Pendon homes” ? i put that in the search engine, but it did not pull anything up. The CMA sounds exactly like what I was looking for. Could you tell me how to get this, and what “CMA” stands for? Thank you so much for your advise.
He didn’t say “Liz Pendon”, he said “Lis Penden”, it’s
Latin for “suit pending”, and is a recorded notice of the filing of a lawsuit, the outcome of which may affect title to real property.
CMA = Comparative Market Analysis. If the subject property is already listed, there is a high likelihood that a CMA may have already been done. Are you working with a Realtor?
Keith
Blondie what area are you in? Since you are in the Property Managing business have you considered buying some properties for long term rental income? Sure it aint fun like flipping, but at least you can say you so something respectable
//I’m just kidding guys, lay off
;D Yup, thats what the “blondie” thing is about. lol!!! Where do I get the Lis Penden report and the CMA? I am not working with a realtor yet, but have an appointment set up.