Rehab Property
I found a REO property listed at $43,000. Rehabbed it would sell for around $52,000.. Estimated cost for rehab is $10,000. It is a twin house. The adjacent house sold for $28,000 last year to an investor who made no improvements. However, it is in better shape than the house I am looking at. Can anyone tell me if they think an offer of $25,000 is unrealistic as I can do some of the work myself? I appreciate any advice. Thanks in advance.
Follow the 100:10:3:1 rule:
look at (in person or on paper) 100 properties
make offers on 10
get 3 accepted
close on 1
Make sure your offer makes sense to you. Know your stopping point for negotiation. You will lose more properties than you will buy. Make the offer and if it is accepted, great!, if not find another property.
Frogger is dead on....kinda a shotgun approach but it works because you are putting faith in numbers.
I don't think that number would be too low to offer...what's the worst they are going to say...no? Then you bring it up a bit and find your stopping point.
Good luck,
Christian "The Solutions Kid" Beebe
[addsig]
I think you should offer even lower you always need to give yourself decent padding because there is always unexspected things that come up in a rehab. If they don't accept thats fine there is always another house and you will know the offer they end up accepting that person will be out some equity.
Thanks Frogger and Christian! I appreciate you help.
Thanks for your advice Demosthenes.
This site is the absolute best. Everyone is so helpful.
Helen
If you're doing this to make money, unfortunately you are going to have to offend some people with your offer. On the other hand. I know a lady that had a property listed for several months at $21k this past year. I was told by a mutual friend that she really just wanted to get rid of the property and she would be happy to get $7k or $8k so you never know.