What Makes A Good Real Estate Deal?

Finding a good deal is important in real estate investing. It’s a key factor in your success in the business. Now what do you need to consider when finding that property worth investing on?

First, you need to look at the numbers. See if you can negotiate a price that is workable for you. You also need to determine the cost to repair the property. If you plan on reselling quickly for a profit, then you have to buy below market value. The old MOA (maximum allowable offer) formula is an investors quick rule of thumb. ARV (after repair value) X 70% – Repairs = MAO. There are many different ways to invest of course. If you’re fortunate enough to get a property with owner financing, that will save you from taking money out of your pocket. You can assign contracts and never own the property. In every case, you need to look at the numbers. 

Second, you need to check on the history and condition of the house. The more issues it has or has gone through, the more likely you’d get a better deal. If the REO has fallen out of contract several times, the bank has problems and is motivated to sell quickly and for a lower price. 

Third, and not the least, you need to look into the motivation of the seller or the property owner. If the owner needs to sell it quickly, the better chance you’d get the property at a lower price.

Keep yourself updated. The more you know about the business, the better you can evaluate and determine deals a good deal. While there are many things that make a great deal, remember the three deal makers that you should watch out for. You can’t let yourself miss out on a good deal.