BiggerPockets

I have my eye on some downright ugly houses that I'm looking into for rehab/flip purposes. Some are vacant and/or condemned and the ones that are inhabited look like only a crazy person would live there.

How does one go about making a deal from this point? I can't make an offer on a house I know nothing about and haven't seen the inside of. Do I mail a letter to the owner expressing my interest in purchasing their house? How do the vets here do it?

Originally posted by Mark Beekman

I have my eye on some downright ugly houses that I'm looking into for rehab/flip purposes. Some are vacant and/or condemned and the ones that are inhabited look like only a crazy person would live there.

How does one go about making a deal from this point? I can't make an offer on a house I know nothing about and haven't seen the inside of. Do I mail a letter to the owner expressing my interest in purchasing their house? How do the vets here do it?

You absolutely can make an offer on a property sight unseen if on paper it looks like it has the potential to be a good deal, that being subjective of course. That's what good real estate contracts are for: They lock up a property so no one else can buy it and allow you time to do your due diligence. You need to make sure that you have clauses in the contract that give you an out and your earnest money back if you decide you don't want to move forward.

Many times you can't even get into homes without having an accepted offer so this is something you are going to need to do on the fly anyway. I'm a contractor and can tell you that you don't want to get into anything that will require structural repairs or changes. That will eat up a lot of your money and your time. Look for stuff that is cosmetic as you mentioned. Changing landscaping can be done on the cheap and make a huge difference in curb appeal. You can install replacement windows on the street only to give the house a better look as well. Curb appeal is just as important, if not more, than the inside appearance.

Many of the best deals are homes that are not on the market. Keep in mind that you will generally be dealing with people who have a far lower base knowledge of real estate than you do. People will think that because a house is run down and they don't have the money to fix it up that they can't sell it. You are solving their problems.

I would first try and contact them with some type of letter that tells them a little bit about yourself and what you do and that you would be interested in buying their property. You can screen them once you make contact with them and find out more details. Once that is done, put in an offer or move on to the next prospect. There's lots of things you can do to build rapport.

You can make a final sale price contingent upon inspection and final estimate of repairs. That puts it under contract and gives you wiggle room to adjust the price after inspecting everything. If you are contacting these people, you should have a general idea of what you are willing to pay as long as the house is in good shape. Keep in mind some (many) people have no idea what their house is really worth. It's best to be honest and up front with them. If they are sticking to a high price, move on. This is a numbers game. If you throw enough doodoo against the wall, something will stick sooner or later.

Originally posted by Brian Levredge

You can make a final sale price contingent upon inspection and final estimate of repairs. That puts it under contract and gives you wiggle room to adjust the price after inspecting everything.

Brian, do you happen to have an example of an offer with such language? I'm just interested in how it would be worded to give me an idea on how to present an offer to these owners.