Finding deals: Tampa, FL area.

4 Replies

My business partner and I are looking for distressed properties in the Tampa, FL area. We are currently working with a few wholesalers in the area, along with local investor friendly real estate agents. We also drive for deals, postcards, ect. However, we have yet to find a home over the last 30 days that meets that 70% rule? Typically the ARV is high from our wholesalers and the rehab is slightly low, which we expected. But even the deals we find from other sources aren't even close to the 70% rule.

Is this an issue in the area or are we just not finding actual "deals?" We don't want to fool with the numbers, but it's getting a little discouraging. Any advice from our seasoned investors?

This market (Tampa) is saturated with wholesalers and many of whom are amateurs. I am not beating them up, that's just the reality. Make sure to do your own due diligence. It is very difficult to find "deals" in this market now.

@Heather Proctor

You don't find good deals you make them.

I know it sounds like a motivational point from cap'n obvious but it's the only way to differentiate yourself from other buyers.

Think of ways in which you can bring something to the deal that your competition isn't.

why should a seller take your offer?

Maybe you can close fast.
Maybe you have few conditions on your offer.

Maybe your advantage comes from what you can do with the property after you close.

Also remember the funnel ratio.

On average it'll take at least 100 offers to close on one deal.

Originally posted by @Eric Delcol :

Heather Proctor

You don't find good deals you make them.

I know it sounds like a motivational point from cap'n obvious but it's the only way to differentiate yourself from other buyers.

Think of ways in which you can bring something to the deal that your competition isn't.

why should a seller take your offer?

Maybe you can close fast.
Maybe you have few conditions on your offer.

Maybe your advantage comes from what you can do with the property after you close.

Also remember the funnel ratio.

On average it'll take at least 100 offers to close on one deal.

 Honestly, it's not the issue of trying to get sellers to sell to me in a competitive market. It's finding deals that fit the numbers. The golden 70% rule. 

@Heather Proctor

What you're seeing is not an anomaly. The Tampa metropolitan area is getting very competitive. I have a hard rule of 75% of ARV after ERC, with labor and misc. cost included in the rehab. Can you beat my estimated labor cost? Can you find a more efficient layout than I plan for the property? Can you be ok with making a 27% margin instead of 30%? Should you stay out of the business because of that lost 3-5% margin, or is the opportunity cost of not doing the deal higher than that lost profit margin?

I know that in some markets like LA and South Florida, investors are even becoming content with 10-15% return. Just to put it in perspective. 

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