Investor · Bloomfield Hills, MI · Member since 2015 · 2 posts · 1 vote
Hey Biggerpockets,
I hope everyone is doing well. I am a fairly new wholesaler as a real estate investor and my property under contract is in a rural area in Michigan. The address is 12815 Shaffer Rd. Davisburg MI 48350. it is 5,019 sq. ft as a fixer upper, 3 beds 4.5 baths and I currently am unable to find any comps with 10% +/- sq. ft for this property on the low end and high end for the selling price to buyers. My criteria I use for finding a comp is 10+/- sq.ft of the property, sold within the last 90 days, within 1 mile of the property, and +/- 1 bathrooms & bedrooms. If possible, how would you determine the comps for this property? I appreciate the help and guidance.
Residential Real Estate Broker · Birmingham, MI · Member since 2014 · 179 posts · 54 votes
11y
You could probably expand the sale date to six months or even 1 year. An appraiser could probably provide better context on professional standards in this area, but I think 90 days is a nice to have not must have.
Are you using realcomp MLS data or public sources? You may be missing transactions with public data.
Out of curiosity, what was the draw to that area? It seems like there a good
opportunities in SE Michigan.
Investor/Landlord · Farmington Hills, MI · Member since 2011 · 1k+ posts · 1k+ votes
11y
It may be well worth bringing in a local appraiser to help with this one. I suspect that house is on a fairly large lot. How much of a project would it be to rehab it? Might there be more value if the house were scrapped and a new house built? Maybe a couple new houses? Is that being done in this area?
The tax assessor can be a resource. How did they value the property?
Investor · Bloomfield Hills, MI · Member since 2015 · 2 posts · 1 vote
11y
Hey everyone, thank you for the feedback. to answer your question Mark- I used public data as I currently don't have access to the MLS. To be candid, before talking to my cash buyers in the beginning I didn't know what they were looking for but I now I do. For this property is a lead I found from rebogateway. Yeah Mark there a lot of opportunities in SE Michigan, a lot of my buyers are looking for Dearborn, Royal Oak, Sterling Heights, and Detroit.
Jeff, after looking at the house twice for a walk through I estimated the rehab to be $100k. You might be right for scrapping the house and building a couple of houses on the property. I just don't where those kind of buyers are, let me know if anyone know anyone else that might be interested. Also, I'm not sure if that is being done in the area.
I have contacted several agents and one agent said he could a market analysis for estimating the value of the property. So we'll see.
Residential Real Estate Broker · Grand Blanc, MI · Member since 2008 · 885 posts · 316 votes
11y
Lannie, you had emailed me about this property as an opportunity I might be interested in. I still might be, but wasn't arriving at the same ARV you had come up with. The comps are out there to support coming close to the ARV that you are advertising if you look at just the lot size and square foot of the home, but all of those homes are superior in that they're newer construction with end-buyer-desired floor plans, have barns or extra garages, and some are even water front. I know the local area very well and am a broker. Not only did I search in Holly School District, but I also went back a full year.
Hiring an appraiser to give you an ARV will likely result in an amount similar to what I've determined. Unfortunately, in the end, what the appraiser comes up with is rather irrelevant because the value still needs to make sense and be there for your buyer.