BiggerPockets

Has anyone seen Property Wars on Discovery Channel? Investors are bidding on properties w/o seeing the inside. They make their decision based on comps in the area. Some get burned and some hit the jackpot. Do any investors here on BP really do this? What are your thoughts on the reality of this program? Thanks -Koel

Yes, I have done this. Here in VA. we have at least 2 wks to check out a property. Still, no interior view. If the place is unoccupied there is a good chance that a window or door is open. If not, you can be sure that windows have been looked in and an assesement of the roof, HVAC, etc. has been made. You can also tell a lot by how the exterior has been maintained. Asking the neighbors is nothing new.

I bought my current residence at the court house. What I find somewhat amazing about the current shows is the level of profit that they are willing to accept - given the unknown costs that are there/could be there. I'm not going to "play" if people are willing to make only 5K. Many of "the numbers" presented are absurd. Have you ever flipped anything without transaction costs? No RE commision, closing costs, carry costs, etc.? Not to mention the low bids on rehab.

@Wayne Brooks, I knock on the door to ask if they want to sell - just to get a small look inside. I haven't gone the court house in almost 10 yrs, but if you think that the other bidder's haven't been inside - you are in for a big surprise.

I like the show, they're in Phoenix AZ, 125-miles away.

Thing I don't understand is, there certainly are other bidders at the courthouse who previously must-have checked out the houses, why is it always one of the "Warriors" gets the house and they never show someone who is not a Warrior present or bidding at the courthouse.

I used to watch the bidding locally and got to know several of the guys . . . they told me: "the best deals are made before it gets to the courthouse."

My favorite part is when they start going through the house and just automatically start tallying up all the upgrades at face value to their bottomline...Its so realistic to just assume you will be able to ask (and get) more for your home (despite the comps) just because of some travertine floors and bullnose sheetrock...

What a joke...

I buy property at the foreclosure sales, called Sheriff Sales here, often. Sometimes we get inside, sometimes not. We look at the properties before the sale, we do not drive around from property to property during the sale. If we did that we would miss much of the sale. Soemtimes the foreclsoure list is 100s of properties and the Sheriff sells them very quickly.

From the original published list, about 1/3 get postponed, sometimes for seemingly no reason. There is an abondoned house that I used to own 3 owners ago that is on the Sheriff list. It is vacant for 2 years now and the owners have split and probably haven't paid their mortgage for probably 4 years, but the sale keeps getting postponed, and its not even owned by the bank yet.

Another 1/3 get cancelled. The owners sell their property, sometimes short sale, or they bring the delinquency current or something else happens to fully cancel the sale.

Of the remaining 1/3 most start at a price too high to be economical and end up as bank owned REOs. Particularly houses with mortgage guarentees like FHA and VA. The banks don't discount the prices and get their guarentee money. Of this remaining 1/3 about 10% to20% are sold to third parties.

I've bought houses at the sheriff sale and even bought an entire subdivision at sheriff sale.

I sat through a marathon of this show.. i particularly enjoy how most of the homes have a full set of stainless appliances.. many have brand new carpet and paint.. at least one had a classic car in the garage.. yeeaaah.. sure!

The show doesnt seem real. To buy property that expensive practically site unseen and to be doing it with debt and such lack of experience in my thought adds up to one things bankruptcy.
Its almost comical and speaks disrespect of our profession as investors. When people think its that easy and they enter this business and realize there is some work involved in due diligence before you buy and by then its too late. Too me all I could think of when those auctions are on tv, is Vegas at the craps table. When professionals in this business buy we know what the arv is and what the rehab cost is.
Because the characters ion the tv show dont know what the costs are for repairs its impossible to know what the profit will be without getting inside. That is just plain stupidity buying rehabs without numbers. You might as well be at a roulette table.
When 90% of the real estate market is available to see the inside why would you even bother with such crap. It shows what lack of experience the players on the show have.
The only way to really take risk on these buildings is to assume you have a solid set of bones or go by outside condition and figure everything inside needs to be replaced. running numbers on anything but this would be pure un educated gambling.
While I have bought buildings like this without getting inside I was buying for 1200 dollars not 120k.

Originally posted by William Bannister:
More likely your going to find a dumpster full of cat piss smelling carpets then a hot rod in the garage. I have been at this 20+ years and bought over 100 homes and gotten one car and it was a rusty old Lincoln worth about 500 bucks. I had em haul it away for parts for 300 cash.
I once found a gun and 165 in cash in an old book and gotten lots of tools but never a 10k hotrod or anything as expensive as a hot rod.
The sensationalism is halarious. To knock on a garage door thinking you know there is a car back there. It could have been a garage full of trash and pissed out couches the previous owners didnt want to discard themselves.

Even the "unhappy" endings are faked.. one house had dozens of scorpions all nested together in the sink and the bathtub.. if you put two adult scorpions next to each other, they fight to the death..

Originally posted by Cheryl C.:
... but if you think that the other bidder's haven't been inside - you are in for a big surprise.

Some buyers in my area who are licensed agents didn't even check the MLS for a house they recently bought at sheriff sale that was listed on the MLS ...