Re: Did these Would-Be Rehabers pay to much? - Posted by Ron (MD)
Posted by Ron (MD) on June 30, 2003 at 07:34:12:
It could be that the original sale price included cash back to the buyers for repairs, making the true sale price something lower. Also, if the buyers were a couple of investor/partners, they may have paid cash, so there may be no loan on it. Could be you could buy it below their sale price without having to do a short sale.
You said that you would offer “65% - costs of repairs - other expenses”. I don’t know what you call “other expenses”, but many rehabbers will pay 70% minus the cost of repairs. This may not be a problem if you are dealing one on one with the sellers, but if you are competing against other investors (e.g., on listed properties), your formula might price you below the market.
But, as Dee said, no one says that you have to pay what any particular seller (or other investors) set as the price…it might just mean you don’t get as many deals.