@David Dachtera I completely agree! I did speak with listing agent directly before I put in an offer. But once I had a buyers agent I was advised not to speak with them. I disagreed because they were not doing their job in finding the sellers needs and developing a rapport with them. I posted earlier in topic regarding this. Now I am about to put a second offer in without this buyers agent using another more competent agent. Should I contact the listing agent first or let my new buyers agent do it. Note: I already spoke to listing agent before I ever had a buyers agent and was informed the sellers were fairly motivated and to submit an offer. No response to my offer. No feedback from other agent who dodged my question if they even spoke to listing agent at all.
I'm curious as to why you feel the need to have a buyer's agent. Doesn't seem to be a productive choice at this point.
yeah I'd agree with most here who say two weeks is too short a period. But given time I would definitely give the cash off with a 40% discount and quick closing.
Rental Property Investor · Atlanta, GA · Member since 2016 · 325 posts · 253 votes
6y
@Eric Roloson Not distressed state all, both times. Latest one is under contract at $128k, vs asking of $140. Both sides generate $850 each in rents, good tenants are already in place with lease till Q3-2020. Good COC.
@Lesley Resnick great comments and perspective! There appears to be a lot of contention between agents, buyers, and investors regarding this specific property. I ran the numbers and know what its worth to me based on the investment I have to put into it. How would you suggest I "lay that on the table"? It was suggested I attach a letter to the offer explaining the reasoning of my offer, would you agree this may help?
The reality is the only true valuation of a property is what someone is willing to pay. All the spreadsheets in the world will not change that. With that said what is the market doing? What has sold recently in this area? In Jacksonville properties on the MLS sell for 95% of asking. The larger wholesalers I know will not negotiate. The market is hot.
Sellers are not interested in what buyers stand to make or cost to rehab. They are only concerned with what they are getting.
I'm pulling money from a lender so the super high EMD is not possible. Any other suggestions to compensate?
So you're not making a cash offer? Conventional lenders won't loan on this type of property. If you're offering 40% less of asking it better be straight cash. Good luck.
Contractor · San Diego, CA · Member since 2018 · 432 posts · 221 votes
6y
@Eric Roloson thanks for the question. Any benefits of doing rural? Yes, you can find rural houses for amazingly cheap sometimes, even foreclosures. It’s nice being in the country, and most of all, I feel good about making a nice house in the country because I want there to be more appeal outside cities. Something I’m getting into, but I’d love to just be developing homesites
Lender · Santa Rosa, CA · Member since 2017 · 283 posts · 255 votes
6y
@Eric Roloson The asking price has nothing to do with the value to you. I skimmed the thread, but it seems like working with the listing agent (and hoping your old agent didn't even present your offer :-) is the way to go. There is one way to present your offer without offending them.
Be straightforward and explain how you are coming up with your offer. Show what you think is wrong with it and how much it will cost to fix those things. You can also say if the well passes inspection, you'll increase your offer by X, if the septic passes, you'll increase your offer by another Y ... Let us know how it goes.
Investor · Johns Creek, GA · Member since 2017 · 463 posts · 488 votes
6y
@Eric Roloson if the seller is not open to the lower price, then it wouldn't matter no matter how you structure the offer. If the seller is open to the lower price due to desperation, then I would recommend a cash offer with much faster close, no contingencies, along with a reasoning for the low ball offer.
Realtor · Tempe, AZ · Member since 2017 · 541 posts · 442 votes
6y
All cash
$5k non-refundable earnest money released directly to the seller as soon as it hits title
No inspection period
7 day close
3 hour response time for the seller
Assuming the seller has the equity to sell at where you are offering, check in with the agent every week. If it goes under contract, call and ask what their inspection period looks like. Call as soon as it falls out "Dang I saw that went back Active. Would the seller be willing to reconsider my offer?" As a last ditch effort, see if the listing agent is willing to lower their commission to get the deal done.
Rental Property Investor · Salem, IL · Member since 2018 · 18 posts · 3 votes
6y
Remember the golden rule. Do unto others as you........i prefer talking directly to seller but sometimes use realtors if i need their leverage. Ive noticed most realtors don't know jack about renting or investing and many don't like working with investors. The purchase price is way down the importance list for me. Run the numbers and comps. Septic is not a big problem just a big cost. Figure unknowns as needing fixed now or soon. Everything has a life span. Brandon Turner has a personized offer letter with his family pic on it. I forget which book but read it. I think its the blue white and black covered one. Ask the seller why they priced it there and what they would actually agree to
Real Estate Agent · Southington, CT · Member since 2008 · 5k+ posts · 3k+ votes
6y
As @James Wise said you want to structure the deal so you have no "outs" in the eyes of the seller. So they know they are taking a hit on the price, but also know this property will be off their hands in two weeks. That has value to some people for sure, seen it in my own investing and negotiating on behalf of clients.
Rental Property Investor · Clarkston, GA · Member since 2012 · 2k+ posts · 1k+ votes
6y
@Eric Roloson I ONLY work with the listing agent!!! You can learn so much by just small talking to the listing agent. Even ask is the seller open to lower offers? What time do they need a sale? Anything, even, am I top bid? They'll not give numbers but I've asked: you know I'm a reliable cash buyer, no inspection, but I understand I'm not top bidder, would raising $500 be good enough? "probably..." I got the deal.
As an educated, experienced investor there's a million reasons why you should only work with each listing agent. Realtor.com now zillow offers "presented by.." for the listing agents. I verify when I call that they are the listing agent.
You do need a buyers agent to submit HUD offers on hudhomestore.com but thats it.
Extreme offers:
- Cash offer
- Earnest = offer price, wired within 10 days of accepting this contract.
- no due dillengence. (if you are "professional" "educated" you do your DD on your 20 min walk through).
- 2 weeks close
- $500 bonus to the listing agent. (I've never had this accepted, its mostly a conversational tactic that gets laughs).
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Remove one at a time the above strong offer bullets and your offer gets weaker and weaker till its no better then any joe blow's financed, 10 day DD, $500 earnest money offer. LOL