This is my first post on this website. However, I have been researching and reading posts here for about a month or so. I currently found my first property that I am trying to purchase. The property needs a lot of work done but the ARV is approximately $682,000 (after finding a zestimate on zillow.com) and the current owners bought the home for $12,000! in 1998. I have been trying to find rehabbers that are willing to purchase the property from me but have been having a hard time. I’ve been going to “we buy homes” websites and emailing everyone asking if they buy rehabs and at how much they will pay on the after market value. The best offer i got so far was 65-70% of FMV… Does anyone know of a better place for me to find cash only rehabbers?
That’s all any smart rehabber will offer. They usually want 30% profit after all expenses. I’ve had that number drilled into my head by the experience people here
WAY TO BIG FOR FIRST DEAL!!! Unless your sitting on a bunch of money.
How much can YOU buy it for.
Houses in that end of the market are DEAD, DEAD, DEAD right now.
To many people bought at the top and are trying to unload that stuff. I wouldn’t go NEAR that house unless I could get it for 50% FMV.
That makes the 15-20% over the rehabbers are quoting you YOUR profit!!!
zillow tends to be high and in the market could be off by 20%.
I agree that this is way too big for the first deal. Try something that is 1/2 or a 1/3 that price that needs carpet, paint and some kitchen and bath work.
I’ve seen Zillow do zestimates of 600k plus on a 400-450k house. See what homes actually sold for, try domania.com and put in the street address.
As for the price, it depends on the neighborhood. Certain section of my state where there are lots of expensive homes are still retaining their value. The local economy is still doing well and people are still making a good income at the higher end of things so some towns are still strong. A client of mine has missed out on several houses because they weren’t willing to move quick enough or thought they were overpriced, but someone else didn’t think so. Again, all real estate is local.
Also you should find something smaller first as you may not be familiar with what your market is. A bathroom/kitchen that came from home depot may be ok for a house that sells in the 200-400k range, but that might be a complete turn off if it’s a 600k+ house.
The problem is… that I live in NYC and all homes are atleast $350,000 The owner of the house paid 12,000 for the house and does not want to live there. I can get the house for $175,000. Should I wholesale the property? (i have no money to start with so I do not know where I must go if i decide to purchase it myself). Here is a picture of the comparables in the same neighborhood and street. Any suggestions would help. My best friend and I are partners in this together and we just need assistance with our first deal so we dont run into any problems later. Thanks all.
You only have 3 comparables from this year and one is half the price of the others. Wide spread on comparables can be your worst nightmare because it’s difficult to pinpoint your price.
if you want to sell it to a rehab to get it repaired, then you’re wholesaling it. Wholesaling doesn’t mean you’re going to get more than 70% FMV (ARV). A rehaber also needs to consider the cost a resale expenses, so don’t think they’re making 30% off of the deal.
If you want to get more than 70% FMV, you’re going to have to assume more risk and actually buy the property yourself.