BiggerPockets

Hello everyone! I'm a first time poster that has been in search of a great real estate investing forum, and hopefully I've found it!

One of the problems that I have when trying to look at potential properties that I'd like to make my first purchase is, figuring out property and rental comps. I usually go to the county auditor's website for my area to find the history, sales prices and ect on the property I'm looking at with accuracy and success, but the one thing I can't get a very accurate idea is rental comps.

I know the general rental rates are in my area, but how do I best determine them if I don't know what someone down the street is paying, or someone a few blocks over?

Is there a good site that has rental information regarding to current rental comps? Or is just knowing the general rental rates in my area enough to suffice?

Thanks!

Thanks for the great information.

I found that RentoMeter appeared to be more helpful. My range was pretty much spot on, however I was on the lower end of that range, but I believe it's justified due to the location.

Pad Mapper was no help at all. I live in a small town of roughly 17,000+ residents, and there is not a lot of rental postings online for my town.

I prefer to start in the town I know best and can easily manage potential properties myself due to my lack of experience and wish for higher margins by doing the work myself.

Try craigslist, zillow and realtor.com.
You can get actual rental listings on there and see what other homes are going for. Do NOT use zillow for the rent estimate. Just use them
to view actual rental listings.

For the most part, rental listings are the actual rent that the owner is going to get. Its not like selling a house where the list price and eventual sales price are rarely the same.

So once you can see the rental listings, you can figure out what your house should rent for. 3 bdrm, 2 bath , 1500 sq ft built in 88...... Rental listing for 1,300.

Great information everyone! Thanks for the help!

I have a pretty good idea of what the potential rent should be, and I've got some great reading material to further refine my findings.

I've got a few things to do before I actually make an offer on the property, but now I've got to figure out the best way I can purchase the property.

The property is listed at just over $15,000 and needs roughly $5-10,000 in repairs, and comparable comps in the area for this kind of house would be roughly $50-55,000.

So with purchase price and repairs, I'm looking at a rough estimate of $20-25,000 investment (not including taxes and closing costs or other MISC costs).

I'll have roughly $14,000 in cash in approximately three weeks, but I do not want to wait. I'm thinking of after looking at the property, of making an offer of $13-14,000 with an Earnest money deposit of $5,000 to the bank and hoping it gets accepted, giving me the time needed to pay for the rest of the property in cash.

The rest of the cash is coming from my Federal Income Tax Refund, which should be here soon.

I've never made an offer for a property for investment purposes, nor an all cash offer. Any potential issues?

I do not have a approval letter either since I plan on paying for the entire property in cash, and I do not currently have a statement to reflect the $14-15,000 in bank statements either (Only around $7,000 at the moment.)

I should have posted the second part of my plan to get the money to fix up the property to a acceptable level for rental.

I was planning on taking a personal loan out using the property as collateral, therefore providing the money required to fix up the place.

Steven,

You make great points and I've thought about it, but truth be told, I'm still a very inexperienced investor still trying to learn what I could do and ect.

By savings, are you referring to just a regular SA (Savings Account) or CD's, or other types of savings with investment in funds or stocks?

I know by claiming a higher withholding that I am losing interest and opportunity costs.

I earn an average salary for the geographic area I live and work, and I believe the reason I get such a large return is due to my dependents and qualifying for earned income credits.

Once my wife begins her teaching career, I know those credits will disappear and my refunds should drastically shrink compared to the large amounts I receive now. With saying that, I'm not a tax expert or even knowledgeable in tax areas.

Thanks for the help Steven!

Back to the post Kyle J replied to about:

So, If I've only got the 7k in the bank RIGHT NOW, and the rest of what I need coming in, say 21 days or less...

What are my options without trying to get financing? I was hoping to send a large earnest money deposit to show my seriousness in my offer, but it'd have to be 5-7K. Obviously I can not show proof of funds yet until the tax return comes in (which will be less than the 21 days).

So, if I want to make an offer, what can I do? Make the offer anyway and see what happens? Will they ask for proof of funds, with in days of the offer?

So, to recap the situation:

I've found a property about two blocks from my personal residence, that is listed around $15,500.

It's a 3 BR, 1 BA with 1,110 sq, and is in need of repairs. The roof and exterior (siding) look to be in decent shape. There is no garage or shed, but does have central air.

The inside appears to have been trashed, new flooring, patch several holes (dry wall), the kitchen needs replaced and I believe the bathroom will also. (This is just from looking in the windows so far, I'm scheduling a tour shortly).

I estimate at least 5K in repairs, with no more than 10K total. I should be able to rent the property out at $500 to $600 monthly.

I hope to submit an offer of either $14,000 - $14,500 and then taking out a personal loan using the property as collateral to get the money required to rehab the place to rent-able standards. I know I'm taking a big risk here by spending all of the cash I have available and becoming cash poor, but I'm prepared to take that risk.

So, I want to make an offer for all cash with having 7k in the bank with the other 7k coming in less than 21 days, but I feel if I wait that long, the property will be gone. So, I hope to send an offer with a EDM of 5-7K and no proof of funds, hoping that it buys me enough time to get the rest of cash I'll need (my refund). Also, I'll want to get an inspection.

Reasonable? Possible? Worth a shot? Risks? (Sorry for the long posts, but I wanted to post as much info as possible for the most informed replies.)

I was hoping that a bigger earnest money deposit would get a deal accepted without having to show proof of funds to purchase the rest of the property. So, therefore giving me the time needed till my refund comes in about two weeks or so now./