All Forum Posts by: Edward A.

 Thanks Matthew - right near there - I will check.  Many commute from this area to Baltimore or Washington for more home for the dollar.  Appreciate the lead.

Thanks Jim - great advice

@Elizabeth Colegrove I agree, I found a great realtor who works hard, but she says she hasn't done much in REO since there were more on the market a few years back. One thing I worry about is that she is getting tired of me asking about different properties so I am starting to use the tools to do my own research. I need to try "driving for dollars" idea, but I bet a lot of them are bank owned and just sitting. I know of two in my neighborhood that several of us neighbors have asked about and they will not work with anyone - they are holding and keeping house maintained.

Great thread.  Same issues here in Maryland for sure.

@Matt Devincenzo  thanks for referring me to the other thread - I am not allow, I thought I was doing something wrong, but I think the banks are getting smarter and then competition tougher.  Think I entered this business too late.  But, I plan on adapting and seeing what else I can do instead.  Was thinking maybe I need to look at a buy and hold strategy and then I can possibly deal with a larger price.

@Jim Viens yes I was referring to an REO - still new at this. I lost a house last week that I bid on that had these numbers: $235K asking price, comps were around $300K fully decked out in the same neighborhood. I estimated about $40K rehab needed to match that. I put a bid in at $215 and I knew that was high based on the 70%*ARV-rehab=$170. I'm not a realtor so closing costs get you as well as other holding costs, etc... I still overbid and lost since I want to get into a rehab for the experience. I think the 70% rule most original rehabbers follow may need to move up to a 80-85% rule. That is slim profits and you better do excellent estimates of rehabs or you will loose for sure.

Looking for a first FLIP opportunity.  I have noticed that foreclosure properties in the Maryland area seem very high for being a foreclosure.  Why are houses that require work/more risk priced at or above market value?  Any suggestions on what I can read to get tips on finding my first rehab effort?

Great thanks.

Excellent advice - thanks.  

I was recently told by my insurance agent that if I am buying a house to resell that they will not insure it.  This was State Farm.  Any suggestions on where to get insurance for house rehab purchases that you are holding 6 months or less?

Any rehab specialists out there ever have to deal with a recalled sprinkler system - what to watch out for, etc. when getting your estimates?

Here is one example of numbers I have been working - I'll change just slightly to keep it simple. Bank is asking $200K for the property. I did a walk through and checklist and estimated about $25K for a good rehab to $40K to do a great rehab. I am looking at holding for 4-6 months for about $1800 a month in holding costs (financing, HOA, utilities, etc.) You have closing costs to purchase and then sell. Comparables in the area say the house is worth $290K when in great condition. So what should be the asking price? I was thinking $185K. I have a much more accurate spreadsheet but basically I would like to know your rules of thumb using these numbers to get a second opinion.