How to properly direct the seller what to do.....

How to properly direct the seller what to do.....

Real Estate Agent · Norfolk, VA · Member since 2015 · 36 posts · 5 votes

I could use some advice  and or recommendations on what to do in a situation. I have a somewhat motivated seller, at least I think they're motivated. They have a house in one state and another one in another part of the country. I'm a license real estate agent and met them doing yard work about 3-4 months ago. The house has been vacant for years and it needs a ton of work. Comps show around $225,000 after upgrade of course.  $150,000 - $160,000 with things as the are and thats stretching it. When I say a lot of work, I mean a lot of work. Over the last few weeks the seller has done some cleaning , but the process is very slow. The property has been vandalized and infested with rodent at one time. Again, it's starting to come around. I've developed a really good rapport and connection and when I list it, Im wondering if $150,000 is even a reasonable offer. Those that sold for $150,000 were is a little better shape. The kitchens and Baths were dated but in a little better shape. Balance on the property is $121,000. What I'm wondering is if there's a way I could help her with getting out of the property buy either buy it myself with out having to go thru the bank. I knows she's expecting to get at least $20,000 after it's all said and done. I think they're paying  about $1000 a month. I'd guess and say the property needs about $50,000 worth of repairs. Any information would appreciated. 

1Reply
21 views

Most Popular Reply

Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
8y

Your best hope is a retail DIY fixer upper buyer.  They can use an fha 203k or Fannie has a similar product.  If she’s “desperate” she has to realize she may not net $20k.  There is no deal here for a flipper.

See this reply in the discussion

7 Replies

Jump to latestLatest
  • Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes
    8y
    So if it’s worth 225k fixed up and needs 50k in Worth, then your max offer price needs to be .7ARV minus repairs so in that case it’s 225k*.7 minus 50k or 107.5k, meaning Likely to a flipper this isn’t a deal. Sometimes you can do 80 percent ARV but still a big difference
  • Member since 2018 · 509 posts · 211 votes
    8y

    This is where a low low low ball offer is appropriate. 

  • Real Estate Agent · Santa Rosa, CA · Member since 2018 · 84 posts · 105 votes
    8y

    Hi Bernard, 

    It seems like $150,000 would leave you with little wiggle room. Projects like these seem to always cost more than you would expect. As far as the negotiations, it sounds like you are taking a good approach, I just finished the audio version of "Never Split the Difference: Negotiate as if your life depended on it" by Chris Voss. This has invaluable tools that may help for you to achieve your target price. 

  • Real Estate Agent · Norfolk, VA · Member since 2015 · 36 posts · 5 votes
    8y

    Thanks guys, I really appreciate the quick responses. 80% AVR would help the situation and if she’s able to bring repair cost down.  Again she owes 121K , lives in 11 hours away and desperately needs to get rid of the property. She’s got resources, but they’re limited.  The great news, the house is in a killer neighborhood and it’s got a great floor plan with good bones on a corner lot brick.  Again thanks.  Obviously whoever buys it will probably need cash.  

    Thanks

  • Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    8y

    Your best hope is a retail DIY fixer upper buyer.  They can use an fha 203k or Fannie has a similar product.  If she’s “desperate” she has to realize she may not net $20k.  There is no deal here for a flipper.

  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    8y
    Originally posted by @Caleb Heimsoth:

    So if it's worth 225k fixed up and needs 50k in Worth, then your max offer price needs to be .7ARV minus repairs so in that case it's 225k*.7 minus 50k or 107.5k, meaning Likely to a flipper this isn't a deal. Sometimes you can do 80 percent ARV but still a big difference

     in todays market one would be very lucky to get these metrics on a flip.. Very lucky to much money and competition chasing the deals.

    If I was listing this of course it would be shown to all the contractors and flippers in the area.  and the highest offer would as Wayne said below come from a owner occ 203k retail buyer who would not mind some sweat equity.

  • Investor · Malakoff, TX · Member since 2017 · 2k+ posts · 2k+ votes
    8y

    If the ARV is $225,000, she owes $121,000, and the house needs a LOT of work I wouldn't consider there to be enough room there for me to make enough money. I'd probably just list it for her to sell 'as is' (assuming she doesn't want to make repairs), rather than purchasing it to resell. Someone else will probably be willing to pay enough for her to walk away with the cash she wants.

Join the conversationCreate a free account to reply, vote on answers and follow this thread.