For you to buy from a wholesaler.....

[Philip Klinck]

If you were to buy from a wholesaler what would the deal need to look like.

I ask because I have a seller that inherited the house. Homes like it are selling in the area from 45-85. The seller wants 25k. Needs a full interior rehab. New roof. Thats about all I know. I talked to a buyer and he said he wants it for about 24k-repairs-my fee. So 10k in repairs he wants it for 14k-my fee. I might be able to get the seller to 17-20k, not sure about 14k. Especially since the next door house which is the same size but in a lot better condition is on the market for 55k. He told me to back out rehab costs and my fee and try to get her to sell for that price. I just think thats a little low. Rents in the area are around 600-650.

Does everyone expect 30% ROI on a rental before maintenance costs?

[Don Konipol]

The less desirable the property and location, the higher cash return demanded. This is to compensate for the "aggravation" factor,management intensity and probable lack of appreciation associated with the lower end areas. 30% ROI on gross rental that you mention often relates to at best 15% net. However, fix and flippers are much more concerned with what they can sell it for. In some neighborhoods almost all sales are to investors.