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All Forum Posts by: Joseph S.

Joseph S. has started 2 posts and replied 16 times.

Originally posted by @Jay Hinrichs:

 Russell,  this is not high school why people get upset when a low ball comes in I will never know.. no one is forcing them to sell.. I get them often I just counter or if I think its some wholesaler I don't even respond I just let it expire.. no emotion..

But that's not reality when it comes to one off buyers and sellers its all emotion.. ergo why you need a middle man ( realtor ) to navigate it all.. and try to take the emotion out of the transaction.. Good agents do that.

Also remember Sellers perceptions are not reality many times.. sellers think things are great with their house when its a train wreck and vis a versa.. buyers especially with all the internet guru stuff are out there in droves trying to wholesale with no money.. a good agent can flesh that out and kick them to the curb like they should.

Yes, it seems that many real estate investors have little to no money and want to have absolutely zero risk in their investment. Zero risk does not exist in any business.

Originally posted by @Jay Helms:

1/100 is a pretty come them @Joseph S.  welcome to real estate investing!

Jay,  if it is 1/100 or even 1/50 hit ratio, this seems more of a luck driven thing than actual  business.

Originally posted by @Ryan E.:

Joseph S. Sound like you have high confidence in your numbers and it looks like a slam dunk deal to me at your asking price at those numbers. Especially with the loan terms you put out...many investors aren’t paying more than two points and around 10%. It’s probably a blessing in disguise this happened to you so that you can do this yourself and profit nicely.

Thanks Ryan, that is what I'm going to do.

Originally posted by @Christopher B.:

Why are you getting upset or feeling insulted? It's just business, move on to the next person. 

Chris, I hate the cliche phrase "it just business, it not personal". When someone insults you in your face and shows his sleaziness it is personal.

Originally posted by @Account Closed:

@Joseph S.  Are you using a Realtor?  If so, have them add a private note on the listing.  It should say... "Do not expect a response to lowball offers."

There are "gurus" that will tell you that if more than 1 in a 100 offers are being accepted you are offering more than you should.

I hate that game.

On the other hand, I have seen someone take $20,000 for a property that had been listed for months at $200,000. It was not a typo. The person took 90% less than they were asking. There had not been any notes on the MLS suggesting they would do it.

Good points Michael. I think that the vast majority of the crazy low ball offers only work on desperate people who have no loans on their property and they just want cash, any amount of cash will do for them.

Originally posted by @Matt K.:

If the numbers aren't coming in close to your "detailed analysis" why not just do the deal yourself and make some money?

That would be my next step.

Originally posted by @Brian Pulaski:

@Joseph S. can you share the actual numbers and scope or no? If you had one or two that low, I would agree. It sound s like you have quite a few all falling in at $80k and some as high as $100k below your ask. That would lead me to believe either the realtor who brought them info missed (although their offers line up with those that saw it), or the value you think could be wrong.

Do you own it or are you wholesaling this deal?

Brian: I own these condo and all three are rented. My asking price: $ 360,000. ARV: $ 600,000 (based on accurate comps analysis). Renovations cost estimate: $ 60,000 (based on accurate estimate by a very good contractor). Additional $ 10,000 in unexpected cost. Taxes for 9 months $ 6,500. Realtor Fees: $ 30,000 (3% of purchase price & 3% of sale price). Hard Money loan Interest: $ 28,000 (10% interest based on loan amount= 90% of asking price+renovation cost). Loan cost: $ 19,0000 ( 5 points basis). Debris removal: $ 2,000. Profit: $ 84,500.

Originally posted by @James Barnhart:

Were those low ball offers or strategically placed offers? If there were several experienced rehab and flip investors that made offers, then they probably know what their costs are. Did this make you recheck your numbers to see if they are correct? Many of us figure the ARV, deduct the profit we want, and the holding and rehab costs. What's left is the price we buy it at.

You could always counter, if you want to.  You could also show your figures to a bidder to show why your price is justified.   They may be upgrading the properties more than you would do.  

Or, you could rehab them yourself, and then sell at retail price and make all that profit for yourself.

Some investors submit several offers a week.  They know that most will not be accepted, but if the seller is in a bind, they might say yes.  I have made several offers a week myself when I see properties not selling after 3 to 4 months on the market.  In this hot market, they should have already sold. Most sellers will offer a counter proposal.

I wish you good luck in getting it sold.

James, my numbers are correct and they did not even debate my renovations costs and the other costs. However they told me that even though my ARV estimate are accurate based on current sold comps there is a risk that the real estate market can drop by 20% in 6 months from now and they have to factor this risk in their offer. Now that is crazy talk because not a single analyst in the country think that this would happen but rather the opposite is true. You are correct, I may rehab these condos myself and sell them at ARV market price but I need to get a loan to do so. I just wanted to try the investors route first to see if works but I ended up very disappointed dealing with them.

Originally posted by @Matthew Paul:

@Joseph S.  I have never seen someone selling a house get the numbers right . Unless they have flipped a house or rehabbed a house . So if you had more than 1 offer from investors that much lower than your asking , you are probably  too high 

Actually my renovations cost estimate is probably higher than what they will actually pay. I got a contractor to give me estimate for renovations cost and I confirmed his estimate through my own analysis, I did a lot of renovations on my residential home and I know what things cost. I even added $ 10,000 for unexpected other costs. As I said it seems the vast majority of investors are hit and run get lucky type investors hoping to get a deal in 1/50 or 1/100 offer and try to get 30% to 40% profit on ARV price. They are not serious people, waste of time, and insulting to deal with them.

Originally posted by @Anthony Gayden:

Joseph S.

I had a similar experience when selling a very inexpensive house a few months ago.

Here I was selling a house for $15k and some investors were offering me $8000 and $9600. I literally laughed in their faces as they tried to explain how that was all the house was worth. A week later I sold the house for $21k ($6000 over asking price).

It boggles my mind that someone would be given a slam dunk deal and still try to squeeze even more out of it. Oh well, their loss.

Exactly Anthony, I laughed in their faces and I told them no deal. But also I was furious and felt insulted after a while.

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