Rental property

9 Replies

  • new to investing 
  • Just made an offer at 20% less than ask
  • got rejected
  • How do I make sure offer gets accepted at below the ask ?

You can't make sure, the best you can do it keep making offers below the asking price until they accept. If not you'd have to move on.

threaten violence.

Kidding, obviously. 

No magic answer to this. Nothing you can do specifically to guarantee this result.

Many factors play a role.

The market.

Sellers desire or NEED to sell

Strength of your offer. Such as quick close ALL CASH high EM no contingency etc.

Originally posted by @Ravindra Sridhara:
  • new to investing 
  • Just made an offer at 20% less than ask
  • got rejected
  • How do I make sure offer gets accepted at below the ask ?

 Hi Ravindra,

Don't always focus on the asking price. If the asking price is too high and you get a property for 20% under asking, then it may not be a deal. Base your offer on the ARV and rent/selling price. If you are in a competitive market, you might have to make a lot of offers before you get one accepted.

There may be cases where the asking price is too low and it might be a good deal at 20% over asking price based on the ARV of the property.

Make your offers more attractive by higher EM or fewer contingencies.

Good luck!!

How do I know ARV before making an offer and doing inspection

offer 20% more than the asking price. You'll almost always get them.  

I had a gentlemen tell me one time(on bidding for roofing jobs, but applies to all bids) 

"If you do not get the job you bid to high, if you get the job you bid too low. 

In RE investing if your offer is rejected you offered too low, if your offer is accepted you bid too high.

I also know that sometimes a seller needs to be brought down to reality. Sellers can have too high an opinion of their property.

If enough people keep making low ball offers the seller will slowly come to the conclusion that the buyers are more accurate on the real value of the property.  Or not. Find a real deal somewhere else.

@Ravindra Sridhara

Don't ever look at the asking price. Do your own figures to purchase a property. 

To determine ARV of a property, you need to know the rehab cost, your profit, buying cost, selling cost and holding cost. Take that number and add that to your purchase price and see your total.

Find out the fair market value of the property that you want to purchase through a local realtor or get a BPO (it will cost you). Now if your total is less than the fair market value of that property that you want to buy, you will walk away a happy camper. 

Hope it helps. 

@Ravindra Sridhara assuming you are looking at SFH, best way to find out the ARV for a property is to establish a relationship with a realtor so s/he can run sold comps for similar properties in the area off the MLS

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