Is it 50% - 70% of ARV or As Is?

Question

I think after reading quite a bit of material that I'm getting a pretty good understanding of the Wholesaling strategy but I've one question:

Are you supposed to offer 50% - 70% of the ARV or As Is Value or the asking price? I feel kinda stupid asking a question like this but for some reason I can't get that one area to stick in my brain. My mind is telling me that it is the As Is Value but I'm not sure. Could someone please be so kind as to steer me in the right direction?

Thank you so much,
Anna

BTW...this place is the bomb...I've been reading for months but just started posting. Thank you to all of you who contribute to make the road for all of us noobs a little easier and less rocky.

Ryan Webber · Answer

Remember that the 70% of ARV minus repairs is a general guideline dependent on your market.  In some of the slower markets, rehabbers may require more, like 65%.  In some of the stronger markets, rehabbers may only need 75%.  It also depends on your investor.  Some rehabbers might need a 10K minimum profit to do the deal, and others may want a 20% profit spread.

As a wholesaler, you need to know your customer.

Minna Reid · Answer

Max at 70% of the After Repair Value MINUS repairs. For wholesaling youd likely need to be at less, since the rehabber would need 70% or less to make it worth their while.

Tom McGiveron · Answer

Anna,

what is the "as-is" price?  and if your'e investing, why would you offer the asking price?

the bottom line is this -

make offers that will increase your likelihood of making money on the deal.  70% below market + repair costs is just a guideline.

asking price 100k

AFTER REPAIR VALUE - 130k

130k - 30%= 91k

91k - 15,000 in repairs/holding/other costs = 76k offer price.

that's a general guideline.

N/A N/A · Answer

I'm sorry for the confusion...here's what I meant.

Is it...

50% - 70% of the ARV or
50% - 70% of the As Is (appraisal at the moment) or
50% - 70% of the seller's asking price

Thank you both for clearing this up for me.