I put out a postcard mailing a week ago and the calls are flooding in and frankly I"m a bit panicked! I only sent out 500 postcards and I've received 5 calls in the first 2 days. 10% response rate is great but here's my problem. Two of these properties I don't know how to tackle. What would you do to proceed on these?
1) Summer cottage (town turns water off in Oct and back on in April) 385 sq ft. Very few comps. Would a flipper even want to take this on? They'll have to hold it at minimum until April to sell. Looking into whether HOA allows rentals. How do I market this?
2) 4 unit compound.
Building 1 - old store front building converted into 2 units
Building 2 - 3 car garage with 1 unit above
Building 2 - small ranch house.
There are no comps in the area even close to this type. It is fully rented ($4,800 gross rents) do I just run numbers on rental to find my offer price and promote it to buy and hold investors and show cashflow?
Unfortunately my area doesn't have tract houses. Properties are very individual and really hard to comp. Any insigts on how to manage this workflow?
First thing: TAKE A DEEP BREATH.
You have got a great response to this 1st mailer. (well done)
Please look at your local tax assessor to find the assessed value of the properties you found. Should be able to do this on line. You can also look at Redfin or Zillow to get their price opinion (though look carefully the numbers are based on a algorithm)
Finally ask a local Realtor to give you an idea how the market is locally, is it hot or cold? The hotter the market the more you can estimate the value above the tax assessed value.
The first house you talked about is good for someone looking for a vacation rental.
The second is a cash flowing property and should be attractive to any investor looking for cash flow property's. Congrats's Kim you are doing Great!
A 10% response rate is excellent. You have received 5 responses from 500 cards--a 1% response rate. If you close even 1 deal it will still be a great start. Best wishes.
Awesome job! Asking an experienced realtor in the area is the best way to go- they will be able to tell you what to expect price wise.
I'll second what the others said and advise you ask an agent in the area to give you an ARV on the summer cottage.
For the multi-unit, yes, market it is a rental. Check out this spreadsheet to help you analyze the numbers:
@Kim Handelman what ended up happening with this intriguing story?
That was a long time ago. None of those panned out. Flippers didn't want to deal with summer cottages. The HOAs were very restrictive. The owner of the property with multiple units wanted way too much for them so that was a bust. I did however get a call right after those on the same mailing that ended up being my first wholesale deal and I made $1,500. Since then I have become a realtor and work with a lot of flippers and am now looking ot buy my own rentals. I hope Colorado is treating you well!