Going to a flip formula from a local "guru" today ...it is FREE and I do have emotions in check...:)...I am not signing up for anything over there that costs me a dollar...but want to see what the environment is like. I am more excited to meet other investors at local REIA next week.
I'll surely come back and write about my experience from today's session!!...stay tuned!
There are a number of flip formulas and they all go pretty much like this - They revolve around maximum allowable offer or MAO. In general your MAO offer is 65% of your After Repaired Value or ARV minus your renovation costs.
So if you have a house that will be worth $100,000 when you are done and it needs $25,000 in rehab then you take 100k - 25k and get 75k, then you use MAO (75,000 X .65) and your offer had better not be any higher than $48,750 if you want to safely make money.
It is easy to focus on the money at the end, but if you dont do the math up front and ensure that you can do this deal safely, then you will learn an painful and expensive lesson. Dont do that.
On a good note, your local REIA is a great place to network and learn from successful local investors, it is a great addition to your BP learning
to your success
PS feel free to connect on BP.
How about the formula of purchase price plus rehab costs total should be 65% of ARV? Basically 2/3rds total of ARV to purchase.
Yeah that is what I was trying to say.
Thanks @Josh Caldwell
for your inputs.
Below is my summary from the “Guru” event…
The event had lot of emotional stories about family - losing someone; pictures of cute kids, babies etc. to pull the listeners in. I went into the discussion with a check on my emotions so may be I wasn’t the best person in audience for them.
Some human behavior elements were good – like taking ownership of your own situation.
First speaker did set expectations that he will sell the course at the end of the day but it was an easy sell because he first set everyone’s expectation for the course to cost $7K but finally offered to all at $2K. that too with opportunities of full refund if they don’t make thrice as much. Good sell for person with low barriers. Lady next to me did sign up during the first break and I felt sorry for her but who am I? another newbie and may be she has researched it enough.
The person kept saying Donald Trump is not sleeping these days because he thinks next two years are greatest time for Real Estate…I won’t forget that…J
all these programs have their roots in MLM.. if you have been to any MLM presentation it always starts out with the speaker show his wife and kids and how you deserve to be there and we are all doing this to spend more time with our family etc etc.. That's great for 1 to 10 year olds but as for anyone who has pre teen to teenagers the last thing they want is to spend hours upon hours with their parents.. LOL.
they hit you with the you deserve this you deserve that.. etc etc.
its funny.. and also remember many times the lead speaker is simply a paid actor non of it is real
Jay Hinrichs, TurnKey-Reviews.com | Podcast Guest on Show #222
Was not able to make the Black Diamond event tonight, but feel free to reach out so we can meet at the next event. Hope you found the event educational.
yes @Brian Ortins it was great event. Missed seeing you but I did get to meet other BP members there. Btw, I'll PM you for another item....thx
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