Neighbours home on Market for 229 day's.How much do I offer them?

Bird Dogs, Wholesaling
41

I would be contacting her boss for help…or just pick whats on his website…that should be the way to go right ?..Question…why should I try to get deals from this guy ,if rehabbers are going to him …prices are already low…wouldn’t this be …me acting as the middle man to deals that are already visible to rehabbers when they visit his website ?

You will need to explain this because I have no idea what you are talking about. Why would you be contacting her boss, who is he and what benefit to you is he? Getting deals from this guy? Who is this guy that rehabbers are going to? You need to be more specific because you lost me. And what is his website? Just a web site of a broker that is listing the properties that his realtors have that are on MLS anyways?

The only benefit a wholesaler is to a rehabber is if the wholesaler finds their OWN deals in some of the ways I previously listed. There is no reason they would need a middle man on anything that is on MLS including REO’s. It is just as easy for them to just get them themselves.

Tell me exactly what your objectives are in real estate. What are you interested in doing and what kind of cash flow do you have to work with. Will you be buying the house outright? Getting a loan on it? Trying to do double closings or assignments? Also how is the credit? There are places for anyone in real estate but there are also limiting factors which can determine where you need to get started.

42

Okay…maybe all that I posted ( regarding this new discouraging realtor & her bosses website ) is irrelevant…What I tried to do is find a REO agent in her…only to realise that she works for a guy who is infact a bulk wholesaler.

His website :
http://www.cassidonrealty.idxco.com/idx/3416/details.php?idxID=204&listingID=330953

This property was an REO :GIS reflects this info…

http://www.lehighcounty.org/Departments/Assessment/SearchRecords/tabid/315/language/en-US/Default.aspx

43

“Tell me exactly what your objectives are in real estate. What are you interested in doing and what kind of cash flow do you have to work with. Will you be buying the house outright? Getting a loan on it? Trying to do double closings or assignments? Also how is the credit? There are places for anyone in real estate but there are also limiting factors which can determine where you need to get started.”

I am persuing all deals as a wholesaler,with an eye for assignment/double closings…cash flow? minimal of my own…will tap into private funding eg Coastal-Funding ,Ivisionary etc…credit ?..non to speak of…laid off the past 16 months & operating in grey… :help

44

There is nothing wrong with buying from a wholesaler. Wholesaler to wholesaler to end user happens all the time.

Wholesaler to wholesaler to flipper, possible but don’t expect to make much.

45

I am persuing all deals as a wholesaler,with an eye for assignment/double closings…cash flow? minimal of my own…will tap into private funding eg Coastal-Funding ,Ivisionary etc…credit ?..non to speak of…laid off the past 16 months & operating in grey…

Based on this, assignments and double closings will work for you, birddogging is another thing to throw into the mix, Subject To’s will work, and sandwiching buyer lease options and that is all I can thing of off of the top of my head that requires very little money. If you want private funding from a hard money lender you will likely need to put some skin in the game, at least 35%.

46

You are going to be most successful if you drop this REO thing you want to do and go out and find problems like I said earlier. It’s good to run the numbers and stuff for practice but if you are operating in the gray right now you need to make something happen and spend 80 hours a week doing one of the things I suggested. REO’s on MLS are investors throwbacks.

The least expensive way to get this kicked off is finding vacant houses in low income areas, finding the owner on GIS and calling them while in the mean time developing a buyers list. There are lots of buyers for these bombed out areas. Mostly what I buy are junkers that desperately need rehab. Also put some we buy houses ads up on craigslist and get some people calling you.

47

You are going to be most successful if you drop this REO thing you want to do and go out and find problems like I said earlier. It’s good to run the numbers and stuff for practice but if you are operating in the gray right now you need to make something happen and spend 80 hours a week doing one of the things I suggested. REO’s on MLS are investors throwbacks.

Ouch!..thanks…I hear you. :eek2

The least expensive way to get this kicked off is finding vacant houses in low income areas, finding the owner on GIS and calling them while in the mean time developing a buyers list. There are lots of buyers for these bombed out areas. Mostly what I buy are junkers that desperately need rehab. Also put some we buy houses ads up on craigslist and get some people calling you.

I did put some ads on Craigs list /Backpage,got the toll free number…need to ad one in our local paper.I’ve been skeptical about going to the middle of the city center for these junkers…even after I have heard that there is success to be had in these areas.Are you wholesalling these profitably too?

Yes…these number running sessions are expanding my brain…but I need to make something happen.
Thanks…now here is an example of one that I looked at today…REO sold as-is …note to buyer’s.
"Buyer is responsible to order U & O (…don’t know what this is…) or any repairs.Minimun EMD - $2500 certified funds…Buyer responsible for winterization/de-winterization…by cntractor approved by seller…Settlement Date to be subject to recording of sheriff Deed."

GIS info reflects :http://www.lehighcounty.org/Departments/Assessment/SearchRecords/tabid/315/language/en-US/Default.aspx

Asking price @ $124,500.

Total Tax Value : $55k

ARV :$150k

MAO : $150k x 50% - $ 20 k- $8k
$75 k-$28 k
$47

Is this worth the trouble given the multitude of responsibility shifted to buyer …winterization/de-winterization…repairs by contractor approved by seller…etc.

Alternatively offer @ 65% - $ 69.5 ( defeats the purpose ,especially since Tax Value is @ $71,400 / or not)

48

Pardon me…Total Tax Value is $71,400 not $55k.

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got the toll free number…

Toll free number? You don’t need that. Wasted money. Only needed for the people who are buying houses outside their local area.

I’ve been skeptical about going to the middle of the city center for these junkers…even after I have heard that there is success to be had in these areas.Are you wholesalling these profitably too?

You can make plenty of cash off a junker. I don’t wholesale any junkers. I keep all that I find and get the right price on and buy any junker that a wholesaler brings me that matches my buying criteria. Rent X 30 minus repairs.

[b]Asking price @ $124,500.

Total Tax Value : $55k

ARV :$150k

MAO : $150k x 50% - $ 20 k- $8k
$75 k-$28 k
$47[/b]

There is no way that the ARV is 150K and the tax value is 71K. Over 2 times higher. Did your tax man take off work for the past 15 years? Governments just love to make sure their tax assessment is right up there close to the real value of the property as they get more money.

Is this worth the trouble given the multitude of responsibility shifted to buyer …winterization/de-winterization…repairs by contractor approved by seller…etc.

A great deal of rental property has responsibility shifted to the buyer. I don’t understand what this repairs by contractor approved by seller is.

The deals you are finding are crap deals because they are MLS. And I am assuming that you looked at the property and know exactly what it will cost to fix it. If someone wants that much over the tax value they aren’t really interested in selling their property. Is your market there BOOMING?

50

OUCH…OUCH…OUCH…This REO has been on the market for 73 days…repairs? …no I don’t “…know exactly how much it will cost to fix it …”

Toll free number is not that bad an idea…it’s actually “call forward” instead of having folks calling my home,directly.

Junkers are good if your well versed in the intricate dealings/ and have enough cash to spread around to hold on to…I’m not there yet.

ARV :I must be off the target herre…care to look it up & tell mewhat it is I’m doing wrong ?

http://www.realtor.com/homevalues/#NEXHASHlat=40.561961999999994&lon=-75.500942&zoom=19

51

Checked this out on : http://www.zillow.com/homedetails/3127-Salisbury-Dr-Allentown-PA-18103/9601385_zpid/....this appears to be more accurate…right?

52

Links to your GIS and Zillow don’t work.

Zillow uses tax assessed value to base the value of the property.

That is also not an accurate way to do it. You MUST see the house, estimate repair costs, look for houses in the area (very close) that have sold recently, if none close to the same sq ft, determine the cost per square foot for the others and apply it to yours.

There is something going on wrong with these ARV’s that you are figuring and you need to fix the problem before buying anything. And drop this MLS stuff. I don’t know how you will assign a REO when the banks are not letting people do that. Double closings will cost you as you have to pay for 2 closings.

If you’re limited on cash flow do assignments instead of double closings.

Or subject to with a lease option.

53

Okay…assignments are what i’m targeting right now…I was reluctant about subject to’s but it looks like I have to do that also…assigning my pose a problem but I’ve heard about “quit claims” may be more feasable for me…

Try the GIS link again please.

Realtor.com…click on “Find home value”…3127 Salisbury Dr,Allentown,PA 18104.

Lehighcounty.org…click on "Search Records "…plug in the address.

54

SUGGESTION, TREAT THEM LIKE PRE-FORECLOSURE, IF YOU HAVE CASH, MAYBE ADVANCE ASSUMPTION FEE THEN SUBLET AND BUILD THE EQUITY FOR SIX MONTHS OR MORE THEN MAYBE CASH OUT BY SELLING NOTE TO NOTEBROKER TO WHOLESALE KEEP INTOUCH TO FOLLOW UP

55

You Have Got To Be Kidding Me!

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CLEELLIO9 …In my attempt not to make this complicated, I want to stay with one strategy ,that of wholesaling period.

Hooch…you’re choise of investing seems to have worked well for you…I certainly thank you for your imput in individual cases.

Having said that…am about to make an offer this morning…check this out for me .

Requested comps for an Estate Sale for on MLS.

Asking price : $140

ARV (per Realtor ) : $129,484 @ $97.21/sq ft…my Arv is $84/sq ft.
House price index : $163,799 ( is this important ?)

GIS total tax value :$85,800

No offere on the table yet…so I hope to offer & see if it sticks…aware that this may have to be done several times.

My numbers…after looking at the house…needs carpet…paint and little else.

ARV :$129 x 70% - ( $11k + $ 6 k…assign fee)
$90k- $16k
$69,900 = MAO

ARV:$129 x 65% - ($11k + $5k…assign fee)
$84 -$15k
$64,900k = $MAO

How does this look…how does this work? …I plan on sending her an email,which she will forward to the saler agent .
Is this where they get back to me with a yah/nay and then they ask for certified funds as EMD ?
I know I shouldn’t antcipate the negotiations…but I must ready myself on how to counter.

57

[b]Asking price : $140

ARV (per Realtor ) : $129,484 @ $97.21/sq ft…my Arv is $84/sq ft.[/b]

The Realtors ARV looks better than those ones that you were coming up with before. It still looks high in my opinion though. But I don’t know your market. During good times the ARV is usually 15% or so above the tax assessed value. I would definitely confirm this with the Realtor prior to the offer. I would ask her to please show you the recently sold, close by properties, and their sale prices that she based her ARV on. Always confirm anything you get from a Realtor because you don’t let other people put your fate in their hands. Smart thing to always do! I’m glad to see that you are using the Realtor to get the ARV since yours were wacked and this will help you learn BUT verify it as any investor would by asking for the data that it was based on.

House price index : $163,799 ( is this important ?)

Not to me

My numbers…after looking at the house…needs carpet…paint and little else.

[b]ARV :$129 x 70% - ( $11k + $ 6 k…assign fee)
$90k- $16k
$69,900 = MAO

ARV:$129 x 65% - ($11k + $5k…assign fee)
$84 -$15k
$64,900k = $MAO[/b]

Please explain the 11k and the 5K on one and the 11k and 6k on the other. Are you saying that it is 11K in repairs and on one you want 6k and the other scenario you want 5K?

How does this look…how does this work? …I plan on sending her an email,which she will forward to the saler agent

You give offer and she will come over to your place with paperwork and want like money for an escrow, I give $500 if it is to a Realtor and $10 bucks if it is to the homeowner. You sign the offer paperwork which there is lots with a realtor, and she gives it to the sellers agent.

Is this where they get back to me with a yah/nay and then they ask for certified funds as EMD ?

At this point my strategy is to give them very little time, like a day or two tops to make up their mind as I have other properties that I need to get to if they don’t want to sell it to me. I found that waiting for a couple of weeks is nothing more than wasting your time when you have to go through many of these. If you are putting the offer in for a bank you may have to give a little more time. I then give a week. The banks will play these games and send you a note back that they are now in a competitive bidding process between you and other investors and to give another higher offer. I don’t like to wait around and let anyone have time to find a higher offer.

I know I shouldn’t antcipate the negotiations…but I must ready myself on how to counter.

You will start at your 65% OR LESS and you will be willing to pay no more than your 70%. There will be no counter offer over that. Maximum Allowable Offer has the word Maximum and you must never break it.

I think you are going to run into problems if you are putting an offer in on a REO and trying to assign it as the banks are not allowing that now.

Look at my other post on valuation of real estate. It is very detailed.

58

Hooch…thanks again for all the insight…this home is not an REO…Estate Sale.

I verified her comps and they are preety much what I should have been doing…all 5 comps are close to the home and have sold within the past 6 months.

I checked all of them to make sure she was giving me the right numbers…she was.

Question …when I look at the GIS and determine the name of owners…& looks like the owners have a differentr mailing address than where property is…cn I go ahead and contact them directly and try to deal with them instead…un-ethical ?..can I get into trouble for this…do I have to wait till their contract with realtor is up ?

The differet number’s I show for the asignment fee is nothing more than my trying to be conservative…if I hope to move anyone I put under contract ,then it serves me well to minimize my fee…right?
The repair costs are based on formula gleaned from this forum somwhere…states that if repairs are minimal,charge $8/sq ft…if medium ,charge $10-$12/sq ft…if really bad,charge $15/sq ft …multiplied by the home sq ft.

In this case the home is alright …good curb appeal…could use some updates,new carpet/new appliances & paint…could be less.

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Question …when I look at the GIS and determine the name of owners…& looks like the owners have a differentr mailing address than where property is…cn I go ahead and contact them directly and try to deal with them instead…un-ethical ?..can I get into trouble for this…do I have to wait till their contract with realtor is up ?

You can’t get in trouble but the seller could as they have a contract with the realtor. No need to contact them though as they won’t likely go around their contract. That is how you find the contact info for someone on a vacant house that you drove by and want. You contact the people on your own potential deals that you find when it is not listed.

if repairs are minimal,charge $8/sq ft…if medium ,charge $10-$12/sq ft…if really bad,charge $15/sq ft …multiplied by the home sq ft.

That’s about right on the really bad side but in my opinion pretty high on the minimal side. You could just need paint inside and out which may cost you 3K or less on a 1,000 sq ft home and compare that to 8/sq ft x 1,000 = $8,000.

It would probably very very accurate for a flipper though as they will do the new appliances, landscaping, etc. If you’re selling to a landlord they will just paint it and fix any safety related issue for code enforcement.

60

Thank you again…guess I must jump in, with great anticipation & expect the best…learn from the experience and do more offers…your response gives me confidence that the time is ripe to place my offer…