Re: Cash Offers. - Posted by HR
Posted by HR on January 31, 2001 at 08:11:23:
I don’t think Ron’s MAO formula is outdated. It’s a timeless way to crunch numbers that makes good business sense.
There used to be a profitable pro who used to post at creonline who shared with me one time that he didn’t even use formulas. His formula was: just how low do I think I can steal it?
It was hard for me to comprehend when I started out. But you need some basis to determine value, right? Well, yes. If one works in homes in a certain price range, and one has a good feel about what the repair costs may be for the rehab, then it’s not hard to “know” what that property will be worth fixed up and to fix it up. At this point, you know what price you can’t go over. At that point, you really don’t need a formula. You then start thinking, How cheap can I get this?
He was right.
I don’t use the MAO formula much anymore.