All Forum Posts by: Brian Woitte

@Sharad M.

Awesome! I appreciate the feedback. So based off of your feedback and some side research this is the plan of attack. Please correct me if it is to lofty or excessive:

I am going to walk through and dissect my own property piece by piece, annotating every item that could and/or should be replaced/fixed. From there I will contact local contractors and determine expected costs for the repair or replacement of each item as well as the most it could cost. Any item that requires dynamic value i.e. flooring, siding, roofing, paint etc... will be broken down based on price per unit of measurement.

This way when I am walking through an unfamiliar house I can say "hmm carpets need to be replaced... their house is 1,000 sqft, half of which is carpeted. I know carpet in my area runs $3.50 per sqft including labor so that would run $1,750.00 for the property. All of this will be annotated on an excel sheet or something that I bring with me of course as a newbie, it would be incredibly time consuming to try and memorize all of the replaceable items in a property as well as what price each item runs for.

@Sharad M. 

Either buyer is fine in my book. I don't necessarily have the experience to disagree with you here however this game is very dynamic. I am assuming you are speaking to the fact that you can look at each item within the house and say "yeah that's going to cost me this much" I, like most new wholesalers have no idea where to even start when it comes to estimating repairs. Is there no general rule of thumb besides knowing the repair costs of flooring, paint, finish plumbing, finish electric, door knobs, kitchen hardware, appliances, landscaping, and final cleaning in your area of operation?

For this scenario lets assume I am selling to fix and flip

As an example of what I was speaking to:

Say you have this house-

https://www.redfin.com/CA/Lake-Elsinore/21001-High...

If you walk in and everything is functional and all you need is some new paint, new floors, and maybe some minor repairs utilizing the theory I listed above the rehab job would cost an estimated: $10,045.00

Now if the place was trashed and needed to be gutted, it would look more like: $30,135.00

Am I in the ballpark here or way off. I'm curious as to what every other wholesaler is doing to determine these values. I.E. calling folks, just say "hmm, well that doesn't look right" and guessing, bringing out the buyer then renegotiating price with seller if need be? There has to be a formula or some true fire method as to provide at least 80% accurate repair costs to potential buyers.

 Of course! That's why this site exists.

Yes, absolutely. It is not much of a contract if both parties don't agree and sign. That's how it is here in California but I am fairly confident that this applies nationwide.  Definitely check out the BP podcasts. There is boat loads of information that break down step by step how to start and complete a wholesale.

http://www.biggerpockets.com/renewsblog/category/p...

I would also check out buy sell fix flip

http://buysellfixflip.com/podcasts/

And if you need some motivation try out

http://www.flip2freedom.com/category/podcast/

@Sam C.  Awesome work!

After an appointment has been made to get a contract signed with a seller and you begin viewing the property general rule of thumb for determining your sell price is 65-70% ARV minus repairs.

What is the best practice for determining the amount of repairs that need to be made on the spot? I have heard a $5-$15 per sqft where $5 is just paint and carpet and $15 is a gut job.

 Is there any specific reason as to why you don't do this? Bad experience? I always put my name on my letters and envelopes. Eventually the individual is going to find out that information anyways and so far, (8 months) this has not been an issue for me.

I can't tell you the return call rate on a no return address however, my return rate with them is out of control. Also, putting a return address allows any mailers that do not reach their destination to come back to you so you can do a skip trace and potentially make a deal. I went down to the post office and opened a P.O. Box for like 15 bucks a month and use that as my return address.

So here is my strategy. I am one hundred percent honest. May not be the best strategy but I try and keep things as up front and honest as possible. At the end of the day I see it like this: If the individual really NEEDS to sell their house it will be quite difficult to force them to lose that motivation. A good way to counteract their possible doubt if it is your first deal is your ability to speak to the real estate terms and processes that wholesaling uses and break it down in such a way that anyone could understand it.

Don't know if you have heard of this podcast yet but definitely check it out:

http://buysellfixflip.com/podcasts/

So I do not have nearly as much experience as most of the active members on this site however I have heard enough knowledge to regurgitate what I have been taught. Best practice is this: Do your initial walk through with the seller, get them to sign the contract and find your buyer. Once you do this inform your buyer that you have located your cash investor and schedule a time in which you both can view the property. Keep in mind that in this scenario you are either "fixing and flipping" or "wholetailing" or "buy and holding" and that you require a cash investor "lender" to facilitate the means in which you are going to buy the property.

To long; didn't read (TL;DR):

Yes

Some resources:

http://www.reiclub.com/articles/wholesaling-buyer

http://www.reiclub.com/articles/wholesale-buyers-h...