New investor needs help with numbers - Posted by Kristen
Posted by Kristen on August 01, 2007 at 19:00:13:
I am new investor starting off wholesaling SFR’s and need clarification on my numbers from anyone who is in a market that has houses still selling for full asking price as well as fixer uppers being sold at or near full value. (I have been searching this whole site and couldn’t find the answer I was looking for).
My market is Seattle, WA and area. My end buyer will be other investors who are going to rehab and sell.
My formula that I use is ARV x .70 - repairs (give or take .20% margin of error) - my profit ($5,000 average) = my maximum buy price.
If deals are being bought by other investors at .85% -.90%, should I be tweaking the .70% by doing my formaula at the .70% - .80% range,? I am just not clear what I should do or if there is a standard formula I should always stick to in this kind of market.
Thank you, I appreciate your time and expertise.