Hello, my name is Mark Bloom. I am a founder and owner of NetWorth Realty USA. I appreciate the discussion and respect all of your opinions. I can say that at all NetWorth offices we strive to provide real numbers and quality product for our investors. All investors and real estate buyers at all levels should always double and triple check all numbers. We strive for accuracy but we cannot guarantee it. As the old adage goes, measure twice, cut once. At NetWorth, we have built a successful company on long term relationships with real estate buyers of all kinds. In DFW, at the end of the last two calendar years we have pulled all the properties that NetWorth sold to other investor/buyers throughout that entire year. In 2012 the resale price that an investor/buyer who rehabbed a property they purchased from NetWorth, and then listed that rehabbed property on the mls for resale, was 103% of the predicted ARV, on average. In 2013 we did the same statistical analysis and the sales price received on the mls was 100% of the predicted ARV, on average. I am more than happy to share this and any other info with anyone who would like to see it the numbers. I apologize that we cannot track the cost of repairs as easily or with the same accuracy. There are many places a rehab can go askew that are well outside of the control of any wholesaler. That said, we are a horizontal organization that prides itself on the highest level of customer service in the industry. If there is ever an issue with a rehab number or with anything at all, as the owner, I am always available for our buyers. I am happy to provide an extensive list of repeat and satisfied buyers. Not 3 or 4, but dozens, possibly hundreds if needed or wanted. If there is anything at all I can do to help you achieve your real estate investing goals in DFW or any other market please do not hesitate to contact me directly.
Not only just the numbers were inaccurate mehn.
I actually just found out when my potential buyers started to leave their feedback that the house is sitting on some sort of hill so that in the backyard there is sort of a slope (not even a slope just suddenly drops down) and it is basically scaring buyers away. Inspection showed termites and all sorts of stuff hidden from me at purchase even though we did an inspection before purchase (using their recommended inspectors). Definitely wrong move for me to be an absentee buyer mehn.
At this point I will be making a huge loss as house is already listed $20K under the ARV they had mentioned. If anyone is interested in buying it off me (it is fully rehabbed except for a few snags that might come out in the inspection; this might cost you $5k at most to solve. And then the drop at the back).
It is in the Dallas area and will rent fast. So it is better for an investor.
Hello fellow Metroplex friends! I just talked with Networth this week. I am just starting out and looking for a property to flip. It does seem like a sweet deal to just have this property handed to you and I can see how the new person may want this kind of deal. But it does not seem like a great financing rate even for hard money. Also I hadn't ran the numbers and seen they take half the profits if you use their financing. Time to move on....
You are correct @Patrick Ellis thatwholesalers can mark up the homes as much as they want and I do think there is a trend of wholesalers (especially from what they say on podcasts) taking more than they did in previous years. After several calls to some of the 'we buy houses/homes for cash' folks to see if they have any properties they want to move and not rehab or hold themselves, they have pretty much admitted this to me a few times. Also one of them told me flat out I would only find an 85% off deal for the DFW area , confirming what you said @Lucia Rushton. 'Those are just the numbers', they say. So finding the 70% off deal from a wholesaler in our market may be a thing of the past.
I just had an odd and I'm not sure even legal experience with NetWorth. First of all, let me say that their comps and ARV were off. But the house I was looking at, I could work around that and still make money. I am new to this but do know enough from my experience as a real estate paralegal and also from flipping my parents house after they passed away. I'm not an expert by any means I am also not a HGTV wannabe. Anyway, Houston is a tough market to compete for properties in so after several months, I went with NetWorth to get started. After looking at several homes, I found one I wanted. I knew the neighborhood and the repairs were ones that I could do 85% of on my own. Hence the ARV and rehab calculations being too high not bothering me much. I did not have enough cash to buy it outright so I went through them, well their 212 loan company, to hard money finance it. I signed a contract and put down $2500. with NetWorth. I was then denied by 212 because they require a credit score of 680 which I fall just below of. On a side note, credit scores don't even need that number for conventional loans...what's up with that? I was not informed of this prior. So, I was told that I could find a different hard money lender and I did. Now, they are saying that they have to show to the house to other investors and that I can come to the showing and say I want it again but if someone else says they want it then we have to draw cards and whoever draws the highest card can buy it. I'm having one of my former associates look over the contract I signed to see if this even legal. They still have my $2500. and the contract.
So, @Denise Tutor what happened to the deal?
Professional oversights notwithstanding, adages such as Caveat Emptor (buyer beware), the importance of investing in your own backyard, being properly capitalized and others seem to have been commonly ignored in most of these horror stories. Because crystal balls are not standard issue in the profession, each of my CMAs has the disclaimer, "Information is reliable but not guaranteed", along with the cautionary tale of obtaining the professional opinion of licensed contractors, attorneys, CPAs, etc. because I am neither. And though they may serve that purpose, these are not intended as weasel clauses but to set a proper expectation; to delineate where my professional expertise and liabilities converge. A licensed real estate broker for over 16 years, I will not and caution others not to invest in markets where one does not have reliable boots on the ground to substantiate the claims of other brokers, wholesalers and others, whose primary goal is often to make money. One must be prudent.
@Mark Bloom are you guys in the Alabama market?
@Oyin A.It’s been a while now. How did your Networth deal turn out in the end?