How do i analyse a deal without showingg

Question

A duplex in Cleveland asking 65k, rent for 500 each, fent nonth by month, fixer, allowing to see the units only after offer accepted.

How can i offer if i don't know the rehab estimate and the ARV? Maybe i can figure out the ARV but not the rehab estimate...

Michael Swan · Answer

Great question Ari.  They are looking for a sucker.  $500 rents are terrible rents for a duplex.  Be careful!!

Swanny

Michael Swan · Answer

Do a 3 to 6 block radius Google earth walk and see where these people will be walking to shop.  Is there anything you would like if you lived there.  Or? Payday loans, broken or boarded up Windows, unsavory characters, a lot of trash etc... really indicating you are  on the border or edge of the bad part.

I would look for good things like grocery stores, Starbucks, Panera Bread or anything that you would like.

Swanny

Joe Villeneuve · Answer

The rehab list I mentioned is my list.  I mentioned it to make the point of having one before you make the offer, and base you offer/rehab on that list.  Your list can be whatever you want it to be.

The area in question defines what is included in the "type" of property.  What it means is all the things that are consistent in properties making up the same Sold Comps...for the same size homes.

If the rehab is bigger than my budget I pass.  Why would I not?

I inspect the property between the time I have an accepted offer, and when I countersign that accepted offer.

Joe Villeneuve · Answer

I stopped inspecting the property before I offer a long time ago.  You have the steps backwards:

1 - Define the size and type of property you will be looking for.2 - Establish a set of rehab fixes you want to do on all of your properties...with pricing.  This should give you a set rehab budget since you should be picking out rehab that you can price based on the size of number of each item.  My list boils down to:  Floors, paint walls and new kitchen.  Since the houses I would be bidding on are all about the same size, and will involve the same demo and construction, I can have a pretty tight range.3 - Have your REA find out exactly what rehab needs to be done from the Selling Agent.  If it involves something other than what I listed above, I don't make any offer at all.4 - MAke the offer based on the cost of rehab I just did the budget for.

5 - If the offer is rejected, I didn't waste my time visiting the site.  If the bid is accepted, I visit the sight the verify the rehab.  Remember, the Selling Agent told me what needed to be rehabbed, so as long as there isn't anything that's a big rehab and it wasn't mentioned, I buy the house.  If the house's rehab needs don't match my rehab list and budget, in other words, the property doesn't want to "play nice", then I pass on the deal...based on inspection.

Michael Swan · Answer

Be careful again.  I have found D class areas have these types of area features Ari.

Buyer beware!!

Swanny

Ari Hadar · Answer

Are you usually aiming at b areas becauseii target c areas because it's the best return and i heard that with good screening i can find  working class people who can pay the rent and keep the house.... Do you think that looking for close amenities is a must for every area (b, c)?

Michael Swan · Answer

hi @Ari HadarVery close to Cuyohoga Job and family services and the Zoo.  Usually when these are found it is not in nice areas Ari.

Swanny

Michael Swan · Answer

Hi @Ari Hadar

Only look at the Commercial in a 3-6 block radius, 9 block radius max, not the houses.

Swanny

Ari Hadar · Answer

I was doing google earth and it seems endless sfr one next to others... The address is 4210 Clybourne Ave, Cleveland

David Da Silva · Answer

On Zillow you can contact the listing agent or use the message box to speak with another agent that can get in contact with the listing agent. Out of those 2 options, your best bet would be to contact the listing agent and explain your terms. The issue with that is the listing agent is most likely gonna be looking out for his seller and not so much you. Personally, I'm not a fan of Zillow at all and I'm an agent myself.

I would find an agent that understands these types of deals and have them submit an offer that protects you as a buyer. Zillow is very generic with info and unless you can research tax info and other items such as liens or inspection issues, an agent (and their team) will save you a ton of time.

How do i analyse a deal without showingg

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