To offer or not to offer? That is the question

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To offer or not to offer? That is the question

Aaron Kovac
Investor · Austin TX (austin, tx) · Member since 2019 · 34 posts · 14 votes

Hi All,

So as I've been reading the BRRRR book, listening to podcasts and researching/practicing analyzing deals every day, I can't help but think about how you will know what a rehab might cost.

If you’re investing from a distance (like an hour and a half away), don’t yet have boots on the ground, and using just pics online to judge a property, I imagine it’s pretty hard to figure out. How are y’all judging what rehab costs might be? Visiting yourself (alone or with a GC/inspector)? Establish boots on the ground?

More or less, as I'm analyzing homes I find on the MLS for practice purposes, I look at pictures of these beat up old houses and never having done a rehab before- I have no idea whether one house will require 10k, 20k or even 50k. As well as which skilled professional might be able to assist with that.

Hopefully this makes sense, but would love to learn what others are doing out there! TIA

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John Warren
Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes
5y

@Aaron Kovac I am very involved in all of the rehab work that I have going here in the Chicago area, and I can't imagine trying to rehab an hour away with no boots on the ground. I think your better option in that case is to potentially partner with someone who knows what they are doing or to invest closer to home. I made the mistake early in my career of always thinking the grass was greener in another market, and I wouldn't be surprised if you are doing the same. Is there truly no opportunity in your local market? Have you worked to build relationships with brokers, sellers, etc? 

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  • Jaron WallingPro Member
    Rental Property Investor · Indianapolis, IN · Member since 2018 · 4k+ posts · 4k+ votes
    4y

    @Aaron Kovac The speed of appreciation in the markets is insane. It's frustrating when you're not in a position to sell or don't want too. In my market it's priced out the cash-flow rental property. I see nothing but flips because most investors realize the numbers don't pencil out for buy and hold. I'm strictly talking C/B class neighborhoods. This cycle continues to suppress available rentals. 

    It honestly feels like the wheels of real estate are out of balance yet it's still drivable. The car is useful but the speed limit before things break hasn't been reach yet. 

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  • Aaron Kovac
    OP
    Investor · Austin TX (austin, tx) · Member since 2019 · 34 posts · 14 votes
    4y

    @Jaron Walling understandable. I’m here in Austin and a residential lender, so I see the same things in the market often. I’m not even considering investing in Austin for that same reason. It’s shifted my focus to other markets throughout Texas where cash flow is more likely to be found.

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  • Jordan MoorheadBusiness Member
    Real Estate Agent · Austin, TX · Member since 2015 · 5k+ posts · 3k+ votes
    4y

    Always make the offer. I just bought a duplex in Austin with $22,000 of equity in it day one. We also got one under contract for a client $60,000 under list price.

    [email protected]512-888-9122
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