The property next door to me is going up for sell next month and pending condition it can be a real good flip in the area where i live but it will need (some work)..lol. im trying to find a good price to offer before it goes to market. i have first dibs but not sure how to analyze it for a flip. Area price 300k to 350k and after speaking with them an offer of 250 would just about guarantee me the purchase but is it too much?.. Need help Asap!!!!
Investor · Fayetteville, NC · Member since 2018 · 263 posts · 216 votes
5y
Antonio - Never take the seller's word for what the property would be able to sell for. Either speak with a real estate agent or you can use Zillow to look at what similar properties in the area have sold for recently. That will give you the value of the home AFTER rehab. Next you will need to determine how much work needs to be completed on the property and develop a cost estimate to conduct those repairs. Then you need to factor in the cost to finance if you are doing so (ie. underwriting fees, closing fee, etc.), holding costs (utilities, property tax, etc.). Once you total up all those expenses you should determine how much you want to make in profit that would be enough to make it worth assuming the risk of flipping a property. Subtract all that from the value of the home and you will have the max you can offer for the home. Good luck!