All Forum Posts by: Steve L.

I don't have issues selling it at $220,000. If that's the most I could get I would still sell it and make a profit. I'm in it, somewhere in the mid 100's.

My question relates more to the market is willing to pay $240k+ for this property, what ideas do you guys have for me to not leave this money on the table, even if it appraises for less.

Ralph the reason I listed it at $239 is so I could get offers in that range and give them to my appraiser. Some appraisers take these into account and others don't...

We've recently completed a rehab, we did a nice job and knew we'd run into appraisal issues. I think it will appraise at $230k, on a good day, but most likely $220k. There just is no comparable and few sales of similar properties in the immediate area.

So I listed it 3 days ago at $239,000. We normally list it about where we think it will sell and let the offers roll in. As of right now, I have 3 solid offers, $247, $245, $240. Four more agents called this weekend and let me know they'd submit an offer today, one is willing to do $90k down.

Most of the buyers are going to go FHA, which is fine with me. But say it appraises at $230k and the buyer has cash to make up the difference? If the loan is $230 less 3.5% down can they pay the difference with an FHA loan. Can I sell them the appliances for $15,000 or $20,000?

What have you guys done to get every dollar out of the property possible?

I use MyFax as well, but only for incoming faxes. When I send faxes, I typically use my home office fax line.

- You can get faxes anywhere. If you're on vacation, if you're on the phone via BlackBerry or iPhone, from your friends connection.
- It keeps a copy of all faxes for up to three months, longer if you keep your email.
- Most of the time, I fax documents to myself and email them to agents. Everyone seems to like email better and it gives me a copy of everything I send out as well.
- You can send faxes from email. I don't really use this, but every so often it comes in handy.

At the end of the day, I don't think it makes much of a difference...

That is a huge profit for your first one. Congrats!!

Did the B-C buyer bring in cash, or private money? Any seasoning issues with financing...

We bought 14-15 properties between October to March (mostly flips, with a couple wholesaled for cash). Two are left under repairs and we are starting to look for some more, but I was hoping this second wave would hit sooner.

From the big REO Players I've talk too:

One had 452 listings either in eviction, active listing or pending listings. They have under 50 right now. The agent said her BPO requests has gone from under 10 a week, to getting 26 in one day though.

Three or four of the medium players used to have 30-40 active listings with 10 new ones a week, they are down to 4-5 each. Inventory seems to be trickling in for them too.

Judging by the pent up demand and the stronger comps we are going to see, I speculate that unless TONS of inventory hits the market all at once things will stay tight a little bit longer at least in Southern California. But come winter, it will be fully buying season.

What really shocks me, even the JUNK JUNK in the market has multiple offers WAY over list price.

Definitely not all areas are equal. Some areas have bleed a ton of inventory and prices really dropped, while others areas are just starting too see bigger drops.

We are being extremely cheap and missing everything right now, so we aren't buying unless it's really the right price.

Depends on your state. In California, you have to wait one day. Your transaction records and the next day it can be recorded to someone else.

Find a money partner. You have more time and skills then money. Find someone with capital but no less time and skills (ie: Drs, Lawyers, etc). Pull off a win-win partnership and prove yourself.

Rinse and Repeat!

Kel - if you read some of the other threads, what is advocated by many of the full-time landlords here:

1. 50% rule in expenses AKA 50% of the rent is allotted for all expenses.

2. The remaining 50% is allotted for a mortgage on all capital invested at 7% over 30 yrs. After paying that they want $100 or more per unit left over.

The reason you are getting negative feedback is the deal does not meet those requirements. Those deals are out there you just need to keep looking.

These numbers are quite conservative, but they have been backed up with real numbers quite a few times.

As Eddie said, if you ended up doing this deal it probably wouldn't end terribly, but if you keep looking there are probably better deals out there.

In this market, I am actually liking FHA loans.

FHA Loans
Upside
1. Loan officer can still pick the appraiser.
2. Only requires the buyer puts 3.5% in.
3. Banks like FHA loans as they are insured by the government.
4. Low qualification standards, you only need a 620, I think.

Downside
1. Takes a minimum of 45 days (at least in my market).
2. Usually weaker buyers use this method as it is all they can qualify for.

VA and Conventional loans the appraiser is assigned at random.

It depends on the definition of not so good. We have found the most profitable neighborhoods are the transitional ones.
AKA, 50% junkers, 1 or 2 being fixed and some nice ones.

To be successful early on in real estate your biggest focus needs to be based on buying right, if you learn how to buy properties enough under market, you have a lot more options.