I have found a VA foreclosure in my area that is a great deal. It is a 1000 sf 3/1 with a 1 car detached garage listed for $69,900. The other comps are both 1000 sf, 3/1, and one is the exact same model home. That one is on the same street and sold for 134,000 and the other one is on the street behind this one, a slightly different config, and sold for 130,000. They also have 1 car detached garages. From the pics, they were clean and well kept, but not particularly updated.
There are multiple offers on this property, which will all be submitted on Tuesday. By our calculations, we can go as high as 81,000 (all cash) and still come out in the 20,000+ range in profit. I have never bid on a VA foreclosure nor gone up against a multiple bid situation. My questions are 1) what would you (other seasoned investors) bid in this situation, and 2) is there anything in particular about a VA offer that will get you noticed above another offer, or is it typically just the highest bidder that wins? THANKS!
is it an MLS listed, bank owned property, or is it an actual real foreclosure auction.
in my experience, if it is a straight forward good deal, the price it sells for will be more than you want to pay. you need to be read for that, and ready to walk away if (when) the bidding goes above your max price.
the deals occur when there are some risks or issues that other people don't want to take on... is it occupied, are there major repairs required, are there title issues? if it is an MLS listed REO, then read the purchase agreement carefully.
You can make money when there are issues, but you have to do your homework. and evaluating whether it is a good deal requires more information.
Thanks for the quick response. This property has been on the market 1 day. It is a vacant property listed through MLS, owned by the VA. It has a few issues, but nothing too major. I am guessing, given the the other multiple offers, that is the take of the others as well. This home is also in a great area with good schools. I didn't mention the other comps both closed in May, so they are a very recent reflection of the value.
Mainly I am unsure where my offer should fall. My thought is that I will need to go above asking, but obviously I want to keep it as low as possible. Is 72,000 enough , 75,000 or closer to 80,000? Just wanted to get sort of a gut sense from other more seasoned investors what they would do.
I would offer what you are comfortable. The line of where is something only you can decide. I know I have lost a few dollars by trying to save a few cents "trying to get the best price." No one knows what enough will be, but if you have a good indication that there is a lot of activity, look to make the offer that gives you that good deal that will make you feel good either way.
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