Yes its me again with thousands of questions.
Many apologies.
I found a “deal” on the MLS for 19k.
The house next door burned down and the subject property has some partial roof damage due to the fire, some electrical burned, and a broken window. (its made of brick so it didnt burn down). There are no appliances, needs sheet rock patch work, paint, some landscaping. in short cosmetic work in my opinion.
Comps in the area are a lot of REOs for 50, 60, and one for 100k (model match)
My subject property is 2/2 (on the mls but I couldve sworn i saw 3 when I viewed it).
So I offered 12k.
offering 3k earnest money which will be given to my agents realtor to be held in escrow when and if my offer is accepted.
The offer will be written under my name. (if i want it written under a land trust do I tell them after its accepted?)
I estimate 20k in rehab work and 6 months of holding.
Soooo…is this a slam dunk or a sinker?
Am i missing somethting?
p.s. I will have 14 days inspection contingency.
Property details:
2/2 (but Im sure its 3/2)
750 sq ft
built in 1960
Just bought one 2/2 used to be 3/2.If you have the room,its not that bad to make 3/2 again and you’ll get a bit more return.I have’nt done a property that small so I’m thinking your repair estimate should work.The good thing about right now is there is’nt much construction goin on so you should be able to get good prices on work to be done.That’s a wide margin of comps too.We always try to price ours at a10-20% below the market.Since its all new,updated, usually sell quick.Hope this helps.I think you’re in the safe zone.
Update
Found out today the property has an accepted offfer today and for higher than asking.
Maybe its for the best.
Next!
Get used to that,benn dealing w/ that for weeks now.The word is out in full force I guess.Good luck to us all.
well its too be expected because inventory is at its all time low of 5 months thats why there has been lots of competition.
In california that is…i dont know about the rest of the country.
So wait till the banks let loose more REOS before spending time on finding deals?
Yeah, I am in California too. There is a lot of competition? Where was that property located , somewhere in the Central Valley?
It’s kind of funny that 19k property probably sold for over $120,000 at the top of the market.
There is pent up demand in California for properties, especially the cheapest ones.
I’ve called on properties and many times they say there were 10 other offers!..
But…who knows how many more REOs will be released so I would say keep submitting offers. It is frustrating , but you never know when you might get an accepted offer.
Also keep in mind that many agents are playing games. Listing properties at low prices with the intention to sell over the asking prices. They will then ask all the bidders for their “best and highest” offer. Playing buyers against each other.
Makes sense about agents listing at a ridiculously low price to attract attention and have a bidding war. I guess they are changing their strategies akin to an auction??
So those who buy on emotion will get sucked into the bidding war.
I live in the coachella valley, the property was located in Desert Hot Springs.
Where are you?
I live in L.A where there aren’t any cash flow deals to be had , but I am looking in the Bakersfield area (Kern County) . It is one of the top foreclosure markets in the country and not too far.
Yeah I noticed properties in Desert Hot Springs were also pretty cheap as well.
A lot of these properties need a good amount of work…the ones that are priced low, as you’ve seen.
If you keep on making offers you’ll get an accepted one eventually.