It is all an estimate, even when you get inside the house. Can you see holes punched in the wall? Does the floor have doggie stains? Does the kitchen look dated? ASSUME THE WORST! A simple window AC unit leak can cause thosands of dollars worth of damage and kitchen subfloors can be rotted through and you not even know it when walking on them.
In college, we’d ask our engineering professors how we are suppose to learn all the stuff and they replied with “through experience.” Hate to say it but it is through experience.
BTW, from experience, backdoors on HUD and REO’s sometimes open when leaned againest
I have worked with 4 realors in the last few months, and every one of them has lost interest in working with me after making 3 to 4 offers on REO properties on my behalf! All of these agents have previous experience working with investors. My offer tends to be 80% of ARV - repair - other costs (closing, marketing etc.) I think they lose interest because they think my offers are too low. Anyone has similar experience?
Look harder to find the right agent. Look at the small ads in the newspapers or on craigslist and others. I own a few small apt bldgs and had started flipping a few sfh on the side. Without the agent I have helping me find some decent investments I’d wouldn’t be walking the walk. They got the means to find the deals if they are motivated. I don’t even pay him except for lunch now & then or a round of golf if I so desire. Its win win man.
You are probably making offers to sellers who are NOT MOTIVATED ENOUGH to sell their homes at the prices you are offering. They obviously can wait for a buyer who will pay them more.
Find sellers who are truely motivated to sell NOW.
Re: Realtors won’t work with me!!! - Posted by nancy _dallas
Posted by nancy _dallas on July 12, 2007 at 14:31:00:
get your own license!!! I’m an realtor/investor… I search for my own deals, also help other investors find deals over MLS, I’m picky with who I work with, only work with people who are have cash and experience, make quick decisions and not trying to bargain on everything… time is money… I pick the client that I want to work with. I find them good deals to begin with, pictures, solid comps, repairs bids, everything they need up front, if some one is getting a deal 70c on the dollar or below, I don’t want him to break it trying to come down another $500
You need to be a "Professional " investor to find a good investor friendly agent to work with, otherwise you’ll just have to work with a newbie agebt who doesn’t know how to find deals and will wast your time
I’ve had several realtors bail on me. One bid on and bought the same house I was bidding on, through him! One told me she liked working with buyers that saw 2-3 houses and then bought one! We just purchased our third investment prop in the last 2 yrs, I guess they didn’t really need the commision money!
Very hard to paint this with a broad brush. Every good deal requires work. I have one HUD property under contract at 60% of what a full retail home in the same neighborhood is priced at. And its an area where homes are selling in 4 months or so (except the wishful thinking priced homes).
I also have 2 REO properties under contract at around 75% of retail (after including repair costs).
I had the same problem with realtors. I gave up on them and have done fine on my own.
Also, I didn’t have much luck with REOs, so I don’t spend much time on them. One company here in Baltimore gets lots of REO listings. They are priced way too high – at or above ARV not counting repairs! They sit on the market because no one in their right mind would pay that much. One of their agents told me they get so many listings from banks because they appraise the house higher than anyone else. I don’t know if that’s true, but if it is it’s amazing.
Now I’m trying to generate my own leads. Several people whom I respect on this board recommend getting away from listed properties.
Having spent my entire life in “commission only” sales I can tell you that all a sales person has to sell is their TIME. In order to get paid that time has to be productive.
Realtors (and other commisioned sales people) “select out” who they won’t work with. When I had no customers, one that would generate $50/month of income for me was worth “massaging”. Once I was established one that was earning me less than $200/month barely warranted a personal visit.
So find someone who isn’t already earning big off high dollar houses.
I am also thinking about changing my strategy not to look at REO properties any more. They have been nothing but a waste of time for me. I think the same goes for HUD properties. I don’t know how any investor makes any money from these properties!
By the way, what kind of marketing are you doing to generate your own leads?
Re: Realtors won’t work with me!!! - Posted by Stephen (GA)
Posted by Stephen (GA) on July 18, 2007 at 02:56:48:
It depends on what you mean by “work with me.” Are you having them meet you at each lead (or worse, drive you), get you inside, run comps, make a VERY low offer? Agents aren’t going to do that for long (even a newbie).
You need to be able to do all the grunt work on your own (Look inside the windows if the back door isn’t already kicked in/open) and then call you agent and tell them what you want to offer.
Agents don’t get paid till you close on the deal so either don’t have the agent work much at all so they can close other deals or close a bunch of deals.
