Submitting Offers on House Flips

7 Replies

My question is in regards to getting your offer accepted when trying to buy a house to flip. I have been a landlord since 2012; I'm up to four houses and a sixteen unit apartment complex. I live in the East Bay Area (Oakland area). I got my real estate license in 2014 since I do a lot of of transactions and it has saved me $30,000 in the last 12 months in commissions. 

I've got some cash available to invest into some additional real estate. I'm debating between purchasing another apartment complex or trying to flip a few houses. I have read dozens of books about people who flip houses with little money, having an agent work with them and I continually think that if they can do it, I can do it. I have the cash to purchase and repair properties all cash; I also have my license, so I can save over half of the commission. 

My question is this: how in the world do you get your offer accepted if you're doing to follow the 70% rule? As a listing agent, I would be insulted (and have been insulted) by some truly ludicrous offers sent in by people who had done no research on the property. Aside from not wanting to be obnoxious, I also have to think of my reputation. If I become known as the agent who always lowballs, my clients will be hurt whenever I submit offers on their behalf. Is it just a matter of submitting enough offers until one gets accepted? Or do you wait until a house has been on the market for a long enough time? We're in a strong sellers market out here and I can't imagine accepting anything that was 70% of ARV. In fact, I just closed on a house in Hayward that we discovered needed $80,000 in repairs, and I still managed to close it within $20,000 of asking price.

Any thoughts on this would be appreciated. Aside from repairs, commission and loan costs are the two most expensive parts of a house flip, and I could avoid both, so it would be very lucrative for me. 

I doubt you could find a flip candidate in the Bay Area on MLS, unless it's a demo/rebuild.

Most rehabbers use wholesalers who have creative methods for finding the diamonds in the rough. Other avenue is courthouse auction if you have a lot of cash.

Hi Jan,

Glad to hear from someone familiar with the area. I noticed you are out in Mountain House (love the area by the way, I've got friends who live out there in a gorgeous 5/3 that costs the same as my 3/1 in San Leandro). Do you do flips? If so, do you do Modesto or Stockton area? I've thought that it would be easier out there; I could buy multiple houses at a time, which would make things a lot easier. Downside is it's an hour away, but that's not the end of the world. 


Hi Rob,

How funny, my office is in San Leandro. Yeah, Mountain House is nice, but getting out of control again. De ja vu 2004-2005 with bidding wars, pre-collapse patterns. Lol

I think your thinking is right, the central calley and Sac may be good areas to look at, I recently started to look too. Done rehab in Sac, not in Stockton and Modesto. My rentals are in Stockton. Been talking to a few out in these areas, the competition for flipping is fierce. Many guys with big time cash, most deals do not have a lot of cash in them. I'll let you know if I find anything, planning to go to the court auction soon to check things out...

I've had great luck with long term buy and hold (1-2 years). Its steady money for very little work. But as an agent, I keep thinking how much I could save compared to most flippers by not having to pay commission or pay loan fees. I wouldn't want to go farther than Stockton/Modesto on a regular basis. But there are a lot of houses between here and there. 

@Rob B. RE agent and Buy & Hold investor here.  

Welcome to BP!

I'd approach things with a slightly different mindset. I want to help others make money rather than cutting them out. That includes agents, loan brokers, etc.  

Anyway, you probably guessed it, lowball offers rarely works in our local market(or in any market). If you are looking at MLS, you probably won't see distressed property either - the moment they hit the market, they gets bid to around 80% - 85% ARV - mostly by contractors/agents who probably think they can afford to go that high because they are 'saving' on repairs and commissions. (sound familiar huh ;)

So how do you find deals? 

Most folks still finding deals through agents - their pocket deals. But why will they give it to you if you are going to cut them out? They give it to the investor who will list the house for sale with them after the it's been fixed up. 

You can also find deals from wholesalers, and other investors in local network events. 

Thanks Eric,

That makes sense. I knew there was something that I had to be missing from the equation. 

Hey guys, as a RE agent and HML in Modesto I can tell you competition is very fierce on "lipstick" rehabs. But on properties requiring more experience it's much easier. A few things set us apart from the Bay.

1. FHA loan limits are much lower so homes with ARV under 300k fly off the shelf if done right.

2. Don't be afraid of the west side ;) buying at $115k and selling at $160k ARV is not a home run, but when you flip 2 a month it's great pay.

3. Construction costs and material costs are cheaper because you are selling a 250k house to a first time buyer, not a 800k house in Poet's Corner. Buyers are totally different in regards to expectations.

I hope that helps. If you need more help or insight into the Valley please feel free to call or email

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here