I'm hoping this isnt a stupid question but what does a wholesaler mean when they say you need to buy "so and so" cents on the dollar? How do I estimate that? How do I figure out my equity range and or potential profit from a sale price and ARV? Is there a simple math equation I can follow
50% is 50 cents on the dollar
I'd avoid wholesalers. They are basically trying to buy something cheap and then flip it without doing anything selling it for a higher price to the next person. If they say 20 cents on the dollar, that means for every dollar it is worth, you pay 20 cents. so a $100K house for $20K. If it sounds too good to be true, it probably is. Do your own due diligence.
Cents on the dollar or pennies on the dollar is simply a discount.
You want to buy at minimum 65-70% ARV minis the repair costs. This will leave you a 20-25% profit after other expenses.