Real Estate Investor · El Paso, TX · Member since 2015 · 21 posts · 9 votes
Hello BP community. So we have a house that was flipped and put for sale back at the end of July. We had an offer in August but after the inspection report she backed out. It was nothing major just a lot of small easy to repair problems. Since then we only had an offer from an investor for 70k a few weeks ago but my other partners rejected it. I myself wanted to just take it and get it out of my hair. We also have another house we are flipping right now and could use the money from a sale. We lowered the price twice already. Is the price still to high? They only problems that I can think of is that the washing machine and dryer are in the kitchen, which was the style back then in these types of houses. Also the whole house was tiled when we bought it, we decided not to spend anymore and just keep the tile, and there is only on bathroom. Any suggestions from the experienced BP community? I am open to all suggestions. Thanks!
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
9y
Sounds you've got some "functional obsolescence". You should have moved the washer/dryer. If buyers have plenty of other choices, they're going to pass because of this, unless they are getting a bargain. Sometimes comps, are not really comps when you have something like this. If you weren't going to add a second bath, you should realize it is not desirable with just one.
Real Estate Broker · Ben Lomond, CA · Member since 2014 · 62 posts · 47 votes
9y
How much are your carrying costs and how long can you hold out and still profit? Those should be additional questions. Your other investors need to know that time = expenses. Figure out your bottom line sales price with carrying costs and maybe counter the investor's offer you received. Sounds like you guys are $9K apart. How fast will carrying costs eat at that difference? Keep dialogue open with all parties. Create a win win situation for all. Good luck.
Broker/Flipper · Austin, TX · Member since 2013 · 4k+ posts · 4k+ votes
9y
A quick glance on Realtor.com shows a lot of competition in the area in your price range. I would have made the $70k offer work if possible. Sometimes it is just a better decision to move on to the next deal
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
9y
Sounds you've got some "functional obsolescence". You should have moved the washer/dryer. If buyers have plenty of other choices, they're going to pass because of this, unless they are getting a bargain. Sometimes comps, are not really comps when you have something like this. If you weren't going to add a second bath, you should realize it is not desirable with just one.
Real Estate Investor · El Paso, TX · Member since 2015 · 21 posts · 9 votes
9y
What is 122 DOM?
Our carrying cost are about $250 a month. We counter offered $76k hoping he would bump up his offer to 74k and we would have just let it go like that, but the guy didn't want to play ball and walked away. We can hold it for a while and still not go into the negative but I would prefer just to work on one house and free up our invested cash.
I agree its best to walk away with some profit than with none.
Sounds you've got some "functional obsolescence". You should have moved the washer/dryer. If buyers have plenty of other choices, they're going to pass because of this, unless they are getting a bargain. Sometimes comps, are not really comps when you have something like this. If you weren't going to add a second bath, you should realize it is not desirable with just one.
There is a storage room that is a part of the house on the opposite side of the wall that would perfectly fit a washer and dryer in it if we just flipped the pipes around. Do you think we should do that?
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
9y
Absolutely. If it's that easy, you should have done it long ago, throwing in some cabinets and a work level surface. Just looked the listing...inside looks well done, back is of course ugly....4 months ago when listed you could have had a nice green back yard....totally unappealing as is.
Real Estate Developer · Ithaca, NY · Member since 2013 · 70 posts · 37 votes
9y
I've sold a flip at a small loss in the past sometimes it's better to liquidate and reinvest the money into a better opportunity. Most of the time people don't take into account what their opportunity costs are. What happens if a deal of a life time comes along and you don't have the cash to pick it up? I think it's better to have cash in the bank.
Sound like your're trying to analyze this property in reverse - it won't sell at our asking price, so what should we have done to make it worth the money?
Where you'd have wanted to be is: "What is our MAO so we can do a minimal fix-up and then list it below market for a quick sale at our minimum asking price?"
Rental Property Investor · Jacksonville, Florida Area · Member since 2016 · 106 posts · 48 votes
9y
I would move the washer & dryer, have the home staged with rental furniture and drapes, hire a professional photographer to take some nice pictures and place an ad on craigslist. Maybe you could rent it short term?
Property Manager · Virginia Beach, VA · Member since 2016 · 2k+ posts · 2k+ votes
9y
I agree on the laundry move. Also, your master bed is staged so that it is completely blocking a door. I assume that is a closet. Isn't there anyplace else to place the bed so that you don't make the closet unusable? I would have also considered completing the L of cabinets in the kitchen to graphic either side of the fridge. This would have cost very little, but would have dressed up the kitchen a lot. I suggest asking your agent what the rule is about withdrawing a listing and resisting it as new. In our market as long as it was withdrawn after being on the market for 90 days, we can relist it as new. You could fix the couple of little things that won't cost a ton, strategize your photos and relist as new. You will get a resurgence of activity just because it's new listing, assuming it is priced right.
Chalk it up to education and keep moving forward! Good luck!
Real Estate Agent · Austin, TX · Member since 2014 · 636 posts · 486 votes
9y
Looks like you're only 10k off of the price the investor was offering. Personally, I'd just take the 70k. I know you said your carrying costs are only $250 a month, but that seems very low for taxes, insurance, debt service, etc. I don't know what your margins are, but even if you end up losing a few $K on it, that's still a pretty cheap education.
Hello BP community. So we have a house that was flipped and put for sale back at the end of July. We had an offer in August but after the inspection report she backed out. It was nothing major just a lot of small easy to repair problems. Since then we only had an offer from an investor for 70k a few weeks ago but my other partners rejected it. I myself wanted to just take it and get it out of my hair. We also have another house we are flipping right now and could use the money from a sale. We lowered the price twice already. Is the price still to high? They only problems that I can think of is that the washing machine and dryer are in the kitchen, which was the style back then in these types of houses. Also the whole house was tiled when we bought it, we decided not to spend anymore and just keep the tile, and there is only on bathroom. Any suggestions from the experienced BP community? I am open to all suggestions. Thanks!
Zillow says your local elementary public school (?) is rated an 8. In LA that could be worth hundreds of thousands more for that alone. Perhaps add that into your marketing focus. Otherwise 70K was a very fair offer from what I can tell 1000 miles away. Also the paint exterior paint color could be an issue. Good luck!
Investor · Houston, TX · Member since 2013 · 41 posts · 16 votes
9y
When I was in El Paso (2 years ago) 122 days was a fairly long market time. What feedback have you been getting on showings? Is there anything consistent that potential buyers are telling you? Also you probably want to get out and take a look at the competition with 1-2 miles of you. You need to see what you're up against and make sure you meet or exceed those for the same price or you'll always be someone's #2. I agree with the post that it seems like you're trying make the house fit the price you want. If you're not getting offers it's either price, features/finishes or location and luckily two of those are easy to adjust.
Flipper/Rehabber · Rochester, NY · Member since 2014 · 1k+ posts · 1k+ votes
9y
@Christopher Herrera, I agree with @Todd Fox. I have a property right now, right in the same price range, $80K, that I am selling for $7K less than my first offer that fell through.
A couple of questions. How many looks are you getting? And how much are you into it for? Would you be taking a loss at $70K? Could you possibly hold it as a rental?
If you are getting a lot (for me that would be at least 4/week) then MAYBE hold out. Otherwise, it really is over priced.
Realtor · Westwood, MA · Member since 2015 · 145 posts · 67 votes
9y
The agent side of my brain is saying "Yes, it's over priced!" because we are always fighting the battle on price. No looks = way over priced, Looks, no offers is slightly over priced. Your helping the competition sell their houses.
btw: a little used opportunity exists to write up an offer agreement and send it to the those who have offered in the past, you never know!
Specialist · Las Cruces, NM · Member since 2009 · 557 posts · 71 votes
9y
I'm a pretty active investor in the area, and to be honest 70,000 sounds like a fair offer considering the size and subdivision that it's in. As an investor my offer would be a lot closer to the 50,000 mark.
Based on your carrying costs it looks like you guys paid cash for the property which is a plus. But is making an extra 2,500 a piece really worth the risk involved?