Is this a good good deal or not?

Question

so i have a property in nj that is under contract at 120 the repairs are about 15-20k and arv 190 but my buyer says its too tight, I thought it was a good deal. What am I missing?

Caleb Heimsoth · Answer

@Tiesha Mckeithan. I doubt you can wholesale a short sale property.  The bank will likely use they’re contract or balk at the assignment clause in yours..

Tiesha Mckeithan · Answer

good morning all, that property just wasn't worth the trouble it ended up being sooo much, but moving on! I have another possible property and the guy owes about 9k in back taxes he wants 145, it is a new construct but he didnt finish it,  I mean the major stuff is done, roof,pluming, siding a?nd duck work the only thing not done is the exterior he claims arv is 310 but I dont see that being true but anyway I want to know a good # I came up with $132k? is that good, its  a 2-3 family house with balconies on 2 and 3rd fl,

Jose Abreu · Answer

having other buyers is the best option because some will go lower than the

30%. Especially on a hot zipcode area.  I think Caleb is correct in regards to not being able to assign (wholesale) a short sale.

Tiesha Mckeithan · Answer

Ok guys thank you all soo much for the feedback and I will keep you all posted but from what I have been told is that we have to create an LLC and sell it, that’s the only way

Frank Geiger · Answer

Could be a good buy and hold if the rents are high enough but doubt the property taxes support it. A flip that skinny isn’t worth it IMO

Tiesha Mckeithan · Answer

@Jaysen Medhurst, ok so here is the story behind the house and my #. So this is a short sale, the owner passed away and the bank was actually at 150, with negotiation they came down on the price so the $120k is their bottom line and my fee. I just went today to take pics for the buyer and it needs some cleaning out, a fresh coat of paint and to be aired out but no real damage to the property, Now I wasn't even thinking about the holding fees but thank you so much, i see its so much i have to learn about this wholesaling thing. I am a licensed realtor but its two completely different worlds I can tell already

Jaysen Medhurst · Answer

@Tiesha Mckeithan, you're buyer's right.

If you're reno and ARV numbers are correct, going by the 70% rule your buyer shouldn't pay more than about $113k, including your fee. I'm assuming you're a wholesaler.

Jacob Sampson · Answer

What is the buyer intending to do with it?  Buy and hold or flip?

As a buy and hold I bet it wouldn't cash flow very well.

As a flip it probably is too tight.  because...

if we estimate 15-20k in remodel it will probably actually be 25-30k.  plus holding costs like utilities, interest, and other misc stuff.  If the ARV is 190k it will probably sell for 180k.  With somewhere near 16k in transaction costs to sell, there isn't a lot left over.

Just my take.

Is this a good good deal or not?

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