BiggerPockets

Hi everyone,

I finally grew a set and contacted a local agent about a junker on the mls. Unfortunately, she claimed a contract is on the house, so it appears I may not get it. After questioning the agent, here are the brief details:

Listing price $29,900
ARV Comps (rough est.) $90,000 - $120,000
repairs - $22,500 (will use $30,000 as hedge)

House is a 2/1, not in a war zone and sitting on a beautiful 90 x 220 lot. I've convinced my dad to start investing with me (he has past experience in more traditional REI). Thought it will be a fun father-son project.

I was going to offer $23,500 based on the following formula:

ARV x .65, less 30,000, less 5,000 (hedge or wholesale, backdoor 2).

I'm curious. Can I wholesale or assign mls properties, or do brokers have a clause to prevent it? The agent stated she will send more properties to me like this one. I'd like to wholesale a few for the experience and some working capital.

Thought I'd share and get some insight as fas as wholesaling and rehabs with mls/agents.

TIA,
Todd

Right- you cannot assign the contract on an REO.. But let me back up and ask a question...

How did you come to the ARV? If it was through the Realtor, shame on you!

Never take anyone else's word for what a property is worth. Before you can make offers on the MLS you must know your area and what properties will sell for quickly.

Therefore, you need access to the MLS so you can pull your own comps, then only go back 6 months and not more than a half mile from the subject property (if possible-go out further if needed).

Once you get access to the MLS- (Just ask a friend who is a Realtor and tell them you only want to be able to pull comps) then take a month to drive out look at the properties, call the listing agent and get access, work your repair est.s then make a pretend offer.

Write up a purchase agreement but don't send it in, then watch the MLS to see what sells and for how much- Did your "offer" come in close to what was paid- could you have wholesaled it for a profit? Go through the motions- (may take longer than a month) This practice will help you "get it" and put you in a position to make offers effectively...

Just a thought!

Let me start with a quick story.

I have a friend who is well known in the Real Estate world and is a wholesaler. His mother who was a realtor brought him a non listed lead and told him it was worth $XXXX based on recent comps. So after getting it, he was familiar with the area, he made an offer sight unseen based on the comps and what his experience was. However, after he closed he found out that the comps were wrong and he had overpaid. His own mother betrayed him (unknowingly of course).

The point is never take someone's word for what a property is worth, especially someone who stands to make money off you.

I would befriend the agent- Tell her your plans about wholesaling, and after some rapport has been built just ask. Why would it damage the relationship if you explain why you need access. Tell her you don't want to waste a lot of her time and this will allow you to do more of the work for her. If she says no, find someone else- also dont get to attached to just one Realtor, interview several.

But if she says no- then tell her no problem but that you will need all the sold comps for the area (give her your parameters for pulling comps) and just let her email them to you. Easy as 1-2-5

I've never had an issue in 8 years of investing, nor have the Realtors I've dealt with. You can also be listed as an assistant to the Realtor in some places and gain access without being a Realtor.

Or Todd you can go and get your license and become a Realtor, or maybe Curt has a better idea as to getting reliable comps? Im all about learning, thanks...

One more thing, I can logically see where comprising one's own comps is most beneficial. However, I'm sure there are different methods of doing so. Not every investor has access to the mls, I would have to assume. I'm learning. That said, I have to get my feet wet somehow and start developing relationships with others in the business.

I like your idea of becoming an agent. In the meantime, what about internet site that do comparative analysis? I recently learned of Zillow or something similar perhaps? do these work?