All Forum Posts by: Philip Williams

Run not walk away as quickly as you can......this is the furthest thing possible from a deal no wonder she is motivated

Closing costs don't come out of our bank account lol. We spend 90k out of our bank account and profited 49,000. So 49000/90000=54.4% Commissions, tax prorations, recording fees etc all comprised that extra 16k which again weren't out of pocket costs..... I'm not sure the reason for your negativity or trying to pick apart my post but maybe you should go troll elsewhere. 

Well that was a pretty negative response lol, perhaps I can elaborate a bit. First the total DOM was 5 until we had it under contract for 155k. Second rural means risk sometimes but that is pretty market specific imo. In this particular small town they have new builds popping up, a great school district and more people looking for houses than houses on the market. Third you did not purchase a 500k house for 120k clearly or you would have actually made money on your deal. I don't count my chickens before they are hatched, the house is already sold and closed. From the initial auction through rehab and sale was less than 5 months. Which includes the time for the court to actually approve the sale so we could get started on the rehab process. 

Hey all just wanted to share a success story for those people saying there are no deals to be found! This property was a foreclosure up for sale at a judicial auction. I have an assistant who runs comps for me on all the judicial sales, figures out the ARV calls and gets the minimums from law firms etc.... On this particular property she was having a hard time running comps. The property in question was a ranch on 3 acres in a small town about half an hour from where we normally invest. To make a long story short it was unique in that nothing remotely close to that type of property had sold in years. Also this small town had not gone online so nothing could be found about sq footage layouts anything. We check all of the major sites algorithms zillow realtor redfin were all over the place anywhere from 70k to 120k. I calculated it at 160k! I knew with such a difference between what the perceived worth and the actual worth there was money to be made. I showed up the date of the auction knowing the minimum bid was 45k and I could comfortably go up to 70k. Lo and Behold no one else bid although others were there bidding on other properties. I firmly believe no one was able to correctly run the comps which kept them from purchasing this gem. Final numbers below!

purchase price 45k
rehab cost 45k
sale price 155k
closing costs 16k
roi 54.4

DOM 5 

total profit 49k

Also you might not want to wait till the first of the year. If the tenant decides to leave you would have a much easier time filling your unit now, rather than in the middle of winter. 

I have also never understood why brokers put below market rents like it is a positive. If the rents could be easily raised with no improvements why haven't they?

Not that it will be of any help but I believe the department you are looking for is asset management? I remember searching for this exact same information a long time ago. 

Well I definitely never said anything about 10k houses lol. While those do exist and I see them at the auction occasionally they almost never get purchases. These are the types of houses where even after they are fixed up they would only be worth 30-40k which is why the purchase price is so cheap. Our normal purchase at the auction is between the 40k-60k range with arv ranging from 80k-150k hope this helps!

Since no one has mentioned it yet......AUCTIONS!!! Sorry to yell lol we are still finding great deals on foreclosure auctions in my area. I think we have done about 5 flips from foreclosure auctions so far this year. We purchased our sixth this last week so that one will be coming soon. We calculate our ARV 3 different ways, first I have an assistant who about half of her job is calculating arv so she specializes in that. Second our realtor sends us what his systems says the property is worth. Third if it passes both of those and the minimum still looks like it makes sense then I personally run the ARV myself.