Buying 12 Props for $15k Each - Posted by Chad (MD)

Posted by Rich-CA on August 14, 2007 at 20:20:52:

You could still wholesale…just more at one time.

Buying 12 Props for $15k Each - Posted by Chad (MD)

Posted by Chad (MD) on August 14, 2007 at 15:54:57:

Hi all,

I had a list from a seller of 12 properties. I looked at most of them and made offers of $15k on five. These were low-ball offers just to fish for motivation. The seller said he would sell them all at $15k – but I had to take all 12. I thought it was a pretty good deal, but my main two rehabbers weren’t interested.

I told the seller my “partner” was not interested, but I would still be interested if he would finance the properties.

He said we could do it one of two ways: either we
could scale it back so that you were interested, or he
could work with me with financing. I’m going to meet
with him tomorrow and get inside a few properties and
take some pictures. I’m meeting with him tomorrow. Of course I will not make any contracts until I’ve seen inside all of them.

What do you think of this deal? My plan would be to assign some, fix some up and sell them one by one as needed, and keep several as rentals.

I have good understanding of values in the area. Five are in really bad shape. They are worth $15k as is – maybe less. But six are worth $20k-25k, and one $35-$40k (because it’s in a better area of town where ARVs are $150-$200k). Of course if I put work into them they will be worth more.

I’m nervous because this is a big deal for me – usually I just wholesale.

Any advice?

Thanks! - Posted by Chad (MD)

Posted by Chad (MD) on August 15, 2007 at 10:41:54:

Just as a follow-up …

The houses were in worse condition than I was expecting.

I met with the seller this morning and quickly abandoned the idea of buying all 12. I am trying to make a deal now on four.

Re: Buying 12 Props for $15k Each - Posted by IB (NJ)

Posted by IB (NJ) on August 15, 2007 at 06:36:52:

Wholesale the headaches (the ones in the bad area) and rehab/rent the one in the nice area. Structure your contract where you are only obligated to purchase the ones in the bad area should your partner agree to buy your contracts.


Re: Buying 12 Props for $15k Each - Posted by Pete CA

Posted by Pete CA on August 15, 2007 at 02:18:40:

buy all and rent out for crazy amount of POSITIVE CASH FLOW…

just my 2 cents…