Does wholesaling normally include or exclude condemned properties? I assume there’s no reason I should keep away from the condemned properties, though I’m a bit worried that buyers might shy away from them out of fear.
If there is no reason to steer clear of them, should I do any leg work like find out why they’re condemned so I can tell the buyer? I started trying to find this information but it was taking a bit of effort to find out. So I began to think it was a waste of time and that the buyer should be doing that.
But then I think, if I don’t know why it’s condemned, I don’t know how much it will be to fix it up and therefore, won’t know how much I can actually offer. Am I overthinking this?
If you are going to wholesale any property, you should have all the details. I would not shy away from condemned properties, but you certainly should know why it is condemned. Often, this can be because it is a drug house; has easily corrected code violations; or has been occupied with the utilities shut off.
Vacant properties are where you will probably find the deepest discounts. It’s an eyesore in the neighborhood and most of the owners just want to get rid of it. This property won’t even cross the radar of retail buyers so that only leaves a small amount of lookers … mainly investors and rehabbers. You need to find out what similar properties in the neighborhood sold for and use that as your after repair value. ARV x 70% - repairs - wholesale fee = bid price. Bring in a contractor and they’ll be able to tell you how much it would cost to fix it up.
Do a search for your county’s nuisance abatement team. They are the ones that coordinate the boarding up and fencing of the vacant houses. Trust me, if its anythign like my county, it will be a TREASURE TROVE of properties (not to mention MUCH easier than driving around). HTH!
Well here’s where I’m at. I have a property whose owner I’m working with. I’m about to get a contract signed. I called the city and they said they’re going to tear the property down soon, but they don’t actually have a date. They said the owner has to file an injunction to stop the demolition.
So do I force my seller to file an injunction or do I just get the deal done and let the new buyer deal with it?
I’m not expert, but from the sound of it if you contract a property to a buyer that is scheduled to be completely demo’d, I’m thinking you’re going to have a hell of a lawsuit on your hands. That sounds like some kind of fraud.
Get the contract written up with the contingency of the homeowner successfully filing the injunction.