What's your biggest automatic deal killer?

Question

Every investor seems to have one thing they won't compromise on.

Some people won't touch floodplain.

Others won't buy without paved access.

Some walk away if utilities are too far away.

For me, it's when the public records and the listing start telling two different stories.

What's your automatic "no"?

Corey Williams · Answer

After 20+ years in real estate development I can confidently say there is only ONE deal killer and reason to walk away and this is whatever your goals and expectations are for the property.

Yes, for sure, as Jason said, unseasoned sellers and their agents can always get in the way at first but if you really drill down to what they want, you can find a way around them.

Floodplain has a solution, floodway, not so much and could be a deal killer. No paved access, that is just a cost to get it.  Utilities too far, we’ve proposed a project to build a 2-mile sanitary sewer force main.

As far as 2 different stories between public records and the listing, I NEVER go with what the listing says.  I always do my own due diligence and study zoning maps and codes to know what I can do with the property.

After I look under every rock and do all of my due diligence, I can present my offer. The seller has a price in mind and if I have to permit floodplain or add a paved lane to get there or run long utilities then my offer is based on my revenue/return goals to make those improvements.  If we don’t align then that is my NO.  This is where Jason doesn’t deal with sellers that aren’t seasoned.  I would at least have a conversation with the seller or their agent to explain what it takes to achieve my goals and likely anyone else that wants to build on this land will have to do the same thing.

Real Estate is an interesting business.  Everyone needs it and everyone has their own goals which means there is no right answer to what everyone’s NO is.

Jason Wray · Answer

My top 3 Walkaways on an REI purchase would have to be these:

1. Unseasoned Sellers agent who did a bad BPO and has owner thinking home is worth well over market vlaue.  Wastes time and sets up false hope on both sides.

2. Taxes being over assessed due to multiple sales with renovations over the last 3 years causing a tax burden

3. Sellers Agents who are "Part time" or only answer their phone few days out of the week.  I have had my clients walk away to avoid chasing a home where the "seller" hired a part time agent who fails to communicate.