I wanted to ask, how can I determine if a property I am researching is a good deal for a flip?
I currently live in NYC and I am looking for properties in PA, CT, and NJ and I see good prices but I'm not really sure if it'll be a good investment. Any tips ?
btw, I am looking at these properties on Realtor.com and Zillow.com
Congrats on starting your journey!
The old rule of thumb is: After Repair Value X 70% - Repairs=Max purchase price. There are tons of other variables such as level of rehab, size of the property, how competitive the local market is for flips, level of profit required, etc. It is really just good for back of the napkin kind of math.
You'll want to look at nice, fixed up comparable properties for your ARV. Then work back from there. There's a lot more to it, but that's a quick and dirty answer! Whether or not it is a good deal FOR YOU (specific strategy for your markets, financial situation, level of skill and experience, etc.) , and not just a 'good deal', is a whole different story!
Thanks for the reply ! Another questions, How do I check how competitive the market is or the comps around the area ? Are there any other sites I can check? P
If you're working with a realtor it will be easier for them to generate comps thru MLS, you can also do it yourself but might take longer..
You might also want to consider getting in contact with a Wholesaler to get leads for flips..
I haven’t reached out to a realtor. I am trying to figure it out myself. I have no idea how to contact a wholesaler. I am working on networking so I can meet people in my area that can help me start this journey.
Thank you for your response !
I have no experience with flipping, but I am in the process of purchasing a rental property in Little Rock, AR. As you know, NYC is just too expensive.
Wow far way from home. I haven’t looked for deals that far yet