All Forum Posts by: Larry Turowski

@Amir B. Off market deal. Every investor wants those. Even though the seller pays the realtor, not you, you don't want to bring a buyer agent in as that will add a cost to the seller, which they may then pass to you. There isn't enough information to say if it is a good deal. Cash-flow-wise, it looks promising, but it may need a ton of repairs, or may be in an area where it simply isn't worth that much. You have to do your analysis.

@Andrea Diaz, yeah, I kind of agree with both @Scott E. and @Steven Foster Wilson. You're question is so general. Someone who is ready to move forward knows what they are looking for for their first deal. That means educating yourself to the point where you can define the what, how much, where questions and then come back here with a more pointed question. My goal for my first few deals was to invest here where I live, I wasn't comfortable with long distance, and to be able to sell without taking a big or any hit if it turned out I didn't hit. That meant either a flips or BRRRs. That in turn meant that I needed to figure out how to find good deals on the MLS (that was possible back then) or through wholesalers or on my own. The meant I needed to look at a lot of deals on the MLS, network with investors and wholesalers and figure out how to market. And those things in turn meant other things.

@Ian Hogan I agree with what @Jim K. said. I’m not smart enough to outperform the stock index. So real estate with leverage provides a much better option.

And that is what is great about real estate. It helps to be smart but you don’t need to be brilliant.

@Tim Ivory the term you are looking for is fair market value, FMV. Whether a home is in terrible condition, is un-mortgageable, or is in showcase condition or somewhere in between you want to know the FMV. That is, you want to know what the house would fetch on the open market, generally meaning it is listed on the MLS.

You'll have to figure that out yourself given your market by looking at sales of nearby comparable homes and size in comparable condition.  Just like with sports where you are told, position your feet this way, move your arm like this, you start out with formulas, e.g. similar square footage, same layout, and it eventually becomes kind of instinctive.  You still use those formulas just they way you still pay attention to fundamentals in sports, but you also develop a feel for it.

This is all a long-winded answer to your question that "as-is" just means that you are not going to require the seller to do anything at all to the house.  It still has a fair market value, but that may not be what it is worth to you.  You need to figure that out.

@Robert Frazier I think in any business these are good questions to ask. That we get defensive says more about us than anything else.

That said, I think these kinds of things need to be handled by local regulation. And maybe more affordable housing isn't the answer.  Maybe people need to move away.

@Erin Babnik Wow that is incredibly cheap! What are “normal rates?”  That should be part of the consideration. 

If you are investing purely for cash flow, which describes most of BP, then it doesn’t make sense. And most would tell not to invest for appreciation. I don’t really invest for market appreciation due to my area but if I lived in an area where that was a big factor and I was confident of it and I had access to cheap money, I’d definitely consider it.

Most investors who do really well do so from appreciation, either forced by rehabbing or adding on, or because they are confident in where the market is moving. 

They are especially useful when they can be applied as filters.  We can’t possibly analyze every deal in detail. A filter narrows the search. It is possible you’ll filter out and discard a great deal, just they way you might if you decide you’ll filter for only 3br houses. But overall the filter is necessary to better manage the mountain of data.

@Roy Gottesdiener sell one keep one, repeat.

@Elvia Morales Flip it. If you think you can find another like this, flip it. It looks like you should walk away with at least 40k. (Hint, do a flat fee listing and save 3% listing agent commission.)

Once you have more money or time than you can commit to flips, then start holding some. 

@Nathan GesnerYours was a very balanced statement. It’s gotten a little angry and combative from there.

I agree good for her. It doesn’t mean everyone can or should do likewise.

The incentive to buying low income housing is higher returns. How do you get that? It is generally because the properties are cheaper because they are in a low income area.  The disincentive is more problems. Not too many will take on the disincentive to get the same returns they would with A class properties. Good for her for doing it but it wouldn’t be a solution. Rent control, for instance would just drive down prices to correct for the lower rents. This would cause other problems (e.g. slums, landlords fleeing).