Visalia, CA · Member since 2013 · 2 posts · 0 votes
I have a property that is 2000 square feet with 2 car detached garage in a good area. The property is in a good, established area in the city. The seller was asking 179,900. but is willing to take 155,000. She will pay 50% closing and all property taxes. The ARV is at about 205,000 and needs around $17,000 in repairs. I would like to wholesale the property but don't know if $157,000 would be a good price to resell it to leave enough profit margin for end-buyer. I've tried the wholesale calculator, but still not sure if I am running the numbers correctly. What do you think about the whole deal? (This would be my first).
I do not know what % of ARV rehabbers are looking for in your area, but the usual formula that most investors use is 70% of the ARV minus the rehab costs. Assuming your rehab costs are correct and ARV is based on reliable and pertinent comps,
So for your deal, taking the 70% of ARV of 205,000= 143,500
- 17,000 = $126,500 (Your maximum asking price)
Again you know your market better, and should know what % of ARV investors are looking for in your area.
I do not know what % of ARV rehabbers are looking for in your area, but the usual formula that most investors use is 70% of the ARV minus the rehab costs. Assuming your rehab costs are correct and ARV is based on reliable and pertinent comps,
So for your deal, taking the 70% of ARV of 205,000= 143,500
- 17,000 = $126,500 (Your maximum asking price)
Again you know your market better, and should know what % of ARV investors are looking for in your area.
I do not know what % of ARV rehabbers are looking for in your area, but the usual formula that most investors use is 70% of the ARV minus the rehab costs. Assuming your rehab costs are correct and ARV is based on reliable and pertinent comps,
So for your deal, taking the 70% of ARV of 205,000= 143,500
- 17,000 = $126,500 (Your maximum asking price)
Again you know your market better, and should know what % of ARV investors are looking for in your area.
Thank you for your responses. In my area, investors are considering the 25-30% profit. So, are most wholesalers still able to give the low-ball offers of 70%, and only subtract the rehab costs to get to final offer, or should the formula for the numbers still include closing costs, and/or agent fees?
Another question: Could there be another creative way of making this a deal and trying to get the owner to comply? The owner still owes 152,000 and is willing to pay property taxes and 50% closing costs.
@Aracely Hernandez, this one is close to being a short sale if the Seller wants/needs to sell quickly ie. not one for beginner Wholesalers. All the best...
Make a lower offer subject to a reserve public auction, offer the seller a 10% hybrid (10% of anything you get over what you offered), make full disclosures, get right of possession (so you can clean the house up and show it to prospective buyers), build in an extension in the event you need more time and use banking days for settlement. A skinny contract should be used also.