Real Estate Investor · Member since 2012 · 189 posts · 32 votes
I was curious what most of you active investors (flippers, buy/holds, wholesaler, etc) do when you're in a competitive market such as what we have now (at least in so cal). Do you ALWAYS visit the property BEFORE putting up an offer? I've met many in the LA market who put up an offer w/inspection contingency. Of course, this implies that they go in with average estimates on rehab w/o truly knowing condition of the property, and then adjust from there - negotiating appropriate credit adjustments from there.
I'm assuming that this may be more the rule than the exception - especially in a competitive market like we're in now. curious if this is common outside of so cal as i'm presuming it is so.
Real Estate Investor · Austin, TX · Member since 2011 · 271 posts · 106 votes
13y
Kelvin K. Are you referring to on market/MLS properties? If so, I think you will find a lot of investors use many other resources than the MLS. Savvy agents will require you to visit the property before making an offer (though legally they must present all offers). So, some do blast out offers at once but given the competitive market, the resistance from agents to entertain such offers, and the fact that owner occupy buyers don't mind paying market value or a premium, the MLS is a tough road.
Inspection contingency will weaken your offer when you are competing against offers with no contingencies, all cash, 21 day close, and big EMD. To have an inspection contingency is normal but to just beat up the seller for a credit/price reduction post inspection is an old trick heavily frowned upon.
Real Estate Investor · Member since 2012 · 189 posts · 32 votes
13y
Hi Chris Sweeney, thank you for your reply. Yes, I am referring to on market MLS properties. Other ways that investors may come upon a property are through pocket listings, direct mail, auctions, and established relationships.
Before this recent hike in price/demand, where did most of your deals come from and where did you actively seek deals? I'm presuming the majority of investors go primarily to the MLS, or at least keep an eye on prospects there.
So to rephrase the question: When you are actively searching the MLS and you find a property that's a deal, what do you do? do you take the time to visit every property that has potential - even if it's not convenient in schedule or distance?
Specialist · Grand Rapids, MI · Member since 2011 · 61 posts · 23 votes
13y
If you don't have much experience, you should definitely at least see the property before making an offer on it.
While you can throw in the inspection contingency, if it is truly a good deal, then you probably won't get it since the seller will more than likely go with one of the other offers without the contingency.
Real Estate Investor · Member since 2012 · 189 posts · 32 votes
13y
thanks Clay Huber for your reply.
I've come across a few posts where i've inferred that when offers are made in high quantity (i.e., 250 offers in one week), it's what I've heard from other local investors: the rehab is estimated into the numbers and an offer made, site unseen - with an inspection contingency.
how effective the offer is, i'm sure, is a different story.