Am I right?

9 Replies

Hi everybody,

I was offered a deal and I just wanted to share my thoughts in order to get some critiques.

The guy is offering a Single Family house that is off market but I was able to find some info online. Zillow and other sites say it is a 2/2.5, but local realtors have the same house as a 4/2.5 on their websites. The seller says the house is appraised at 95k (wich I verified with the county's property tax website), and he says the house needs 30k in repairs. He is asking 45k and he says he has 3 weeks to unload it. I saw some pictures and it seems the house really needs those 30k in repairs. Location is not bad, but it isn't the best either.

Before making any appointment to see the house my answer was as follows:

95k ARV, with a loan of up to 70% ARV makes the potential loan around 66k, less 30k in repairs gives a fair price of 36k. I'm still waiting for an answer from the seller in order to schedule a showing, but let me know your opinions.

Medium aldeausaPavel Reyes Valdes, Reyes IT and Trading, LLC | [email protected] | 5022964839 | http://www.louisvillehouseseller.com

"Appraised" for $95,000 or "assessed" for $95,000?  I'm guessing it's actually "assessed" at 95k and not an actual appraisal. There is a difference between the two words, a very important difference.

Dawn Anastasi, Core Properties, LLC | http://www.coreprop.biz | Podcast Guest on Show #29

How are you planning on purchasing the home?  Are you keeping it for yourself? 

You would have to do a cash out refi or get a hard money loan if keeping for yourself. 

You should try to get this for around $30k

Medium buymemphisnow stacksCurt Davis, Buy Memphis Now | [email protected] | 605‑310‑7929 | http://www.BuyMemphisNow.com

The "assessed" value is the value the city/county places on the property for the purposes of collecting property taxes.

The "appraised" value is based on other recent nearby comparable sales. This is what the ARV should be based on.

What have other, similar sized homes in the area sold for?

Dawn Anastasi, Core Properties, LLC | http://www.coreprop.biz | Podcast Guest on Show #29

I was trying to check out that info, but I've just got data about other houses that are not really comparable. I think I will have to go there and see the place by myself in order to verify the inaccuracy on the number of rooms before looking for real comps. thanks again

Medium aldeausaPavel Reyes Valdes, Reyes IT and Trading, LLC | [email protected] | 5022964839 | http://www.louisvillehouseseller.com

Originally posted by @Pavel Reyes Valdes:

Hi everybody,

I was offered a deal and I just wanted to share my thoughts in order to get some critiques.

The guy is offering a Single Family house that is off market but I was able to find some info online. Zillow and other sites say it is a 2/2.5, but local realtors have the same house as a 4/2.5 on their websites. The seller says the house is appraised at 95k (wich I verified with the county's property tax website), and he says the house needs 30k in repairs. He is asking 45k and he says he has 3 weeks to unload it. I saw some pictures and it seems the house really needs those 30k in repairs. Location is not bad, but it isn't the best either.

Before making any appointment to see the house my answer was as follows:

95k ARV, with a loan of up to 70% ARV makes the potential loan around 66k, less 30k in repairs gives a fair price of 36k. I'm still waiting for an answer from the seller in order to schedule a showing, but let me know your opinions.

The county assessment is not an accurate determination of value. And I have never once seen a seller's repair estimate come back accurate. It very well might be twice the $30K he mentioned (pictures can also be deceiving). Is there any way you can walk the property? That would help answer a lot of your questions.

Medium apartment logoAndrew Syrios, Stewardship Investments | http://www.StewardshipProperties.com | Podcast Guest on Show #121