Finding Deals Below Market Value

Member since 2021 · 3 posts · 4 votes

Hey all,

New investor looking to get my feet wet in the Charlotte Market. Down payment ready and loaded.

I'm cautious when analyzing deals - I've heard the 1% rule, 7% CoC return, and just spoke to a trusted friend who advised me to think primarily about finding deals below market value.

My question - which of these do you follow most? When finding deals below market value, is it best to just call as many wholesalers as possible? Do you have any other tips on deal analysis for a beginner?

Thanks all - and looking forward to participating more!

Logan

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Laura Shinkle

Realtor · Charlotte, NC · Member since 2017 · 359 posts · 293 votes

@Logan Matlock What are you investing in? LTR, STR, MTR, flips, househacking? There's so many different ways to invest and everyone will give you a different answer on ROI (return on investment) criteria or what THEY use.

Go back to the most basic question. What is your goal? Are you looking for cash flow? Are you trying to quit your day job or just have an investment on the side? Are you trying to reduce your monthly expenses?

Start there, have a clear vision on what you're trying to accomplish, and then see if Charlotte is a market where you can achieve that.

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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
3y
Quote from @Logan Matlock:

Hey all,
New investor looking to get my feet wet in the Charlotte Market. Down payment ready and loaded.
I'm cautious when analyzing deals - I've heard the 1% rule, 7% CoC return, and just spoke to a trusted friend who advised me to think primarily about finding deals below market value.

My question - which of these do you follow most? When finding deals below market value, is it best to just call as many wholesalers as possible? Do you have any other tips on deal analysis for a beginner?

Thanks all - and looking forward to participating more!

Logan

Best to try and find deals yourself, that way you are skipping the middle man and the fees involved. Next would be a wholesaler or a lender who foreclosed and took it back as a REO.
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Steven Foster Wilson
Rental Property Investor · Columbus, OH · Member since 2017 · 3k+ posts · 3k+ votes
3y
Quote from @Logan Matlock:

Hey all,
New investor looking to get my feet wet in the Charlotte Market. Down payment ready and loaded.
I'm cautious when analyzing deals - I've heard the 1% rule, 7% CoC return, and just spoke to a trusted friend who advised me to think primarily about finding deals below market value.

My question - which of these do you follow most? When finding deals below market value, is it best to just call as many wholesalers as possible? Do you have any other tips on deal analysis for a beginner?

Thanks all - and looking forward to participating more!

Logan

I cold call everyday to try to find my clients off market deals. I would try to find someone like that who you can build a relationship with. Getting into real estate you want to build a team which would be realtor, property manager, contractor, and bank relationships. https://www.biggerpockets.com/... This is an article for out of state investors although I think if you want to keep growing you have to set your systems in place.
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Logan Matlock
OP
Member since 2021 · 3 posts · 4 votes
3y
Quote from @Steven Foster Wilson:

Quote from @Logan Matlock:

Hey all,
New investor looking to get my feet wet in the Charlotte Market. Down payment ready and loaded.
I'm cautious when analyzing deals - I've heard the 1% rule, 7% CoC return, and just spoke to a trusted friend who advised me to think primarily about finding deals below market value.

My question - which of these do you follow most? When finding deals below market value, is it best to just call as many wholesalers as possible? Do you have any other tips on deal analysis for a beginner?

Thanks all - and looking forward to participating more!

Logan

I cold call everyday to try to find my clients off market deals. I would try to find someone like that who you can build a relationship with. Getting into real estate you want to build a team which would be realtor, property manager, contractor, and bank relationships. https://www.biggerpockets.com/... This is an article for out of state investors although I think if you want to keep growing you have to set your systems in place.
Thank you! Will ask my realtor to start looking into this.
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Corby GoadeBusiness Member
Investor · Boise, ID · Member since 2014 · 3k+ posts · 3k+ votes
3y
Couldn't care less about those arbitrary rules.
If I can be all in around 80% LTV or better, I'm going to take a closer look.
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Laura Shinkle
Realtor · Charlotte, NC · Member since 2017 · 359 posts · 293 votes
3y
@Logan Matlock What are you investing in? LTR, STR, MTR, flips, househacking? There's so many different ways to invest and everyone will give you a different answer on ROI (return on investment) criteria or what THEY use.
Go back to the most basic question. What is your goal? Are you looking for cash flow? Are you trying to quit your day job or just have an investment on the side? Are you trying to reduce your monthly expenses?
Start there, have a clear vision on what you're trying to accomplish, and then see if Charlotte is a market where you can achieve that.
2 Reply
Julien J.
Investor · CO · Member since 2016 · 757 posts · 1k+ votes
3y
Rules are meant to be broken.
Apply only the rules that match your strategy. I've yet to acquire a deal with the 1% or the 7%COC rules and somehow managed to retire from the corporate world with a small portfolio of rentals. I'm in the Seattle market, maybe that has something to do with it.
I'd recommend a 5 year forecast. Hold it long enough ~5yrs and you'll blow out the rules. Its better to get going then stick to generic rules.
As far as finding deals. Grind & network away its a highly competitive world out there. Don't forget the MLS, there are plenty of deals still. That's where I got all of mine.
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Patrick DruryBusiness Member
Real Estate Agent · Columbus, OH & Cleveland OH · Member since 2021 · 1k+ posts · 2k+ votes
3y
@Logan Matlock
If you want the best deals, hop on the phone are start cold-calling sellers directly. That's how I buy all the deals I own.
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Jared Threat
Member since 2020 · 36 posts · 13 votes
3y
I am new to this as well. I upgraded to BP pro and just analyze deals until the day comes where I find one that pencils out. I just became a RE salesperson to gain access to the MLS as well.
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Alecia LovelessPro Member
Member since 2019 · 3k+ posts · 2k+ votes
3y
@Logan Matlock I primarily use the MLS. I search my target areas every day to stay I'm on top of what's there.
I also have a great real estate agent. He keeps his ear peeled for any listings coming through his brokerage that they will be marketing in-house before putting them on the MLS. I've gotten 3 of my deals that way.
I also try to let as many people as I can know that I’m a real estate investor. Occasionally people contact me with their deals privately. Mostly these people are too unrealistic on their values but it gives me an opportunity to try to get off-market deals.
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Logan Matlock
OP
Member since 2021 · 3 posts · 4 votes
3y
Thank you all!!
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Harrison Charles Edwards
Real Estate Agent · Charlotte, NC · Member since 2022 · 9 posts · 8 votes
3y
Hi Matt I work in the Charlotte area and would love to connect!
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