First Deals, First Offers

[David Gunn]

Needing some assistance on writing offers. Matt Theriault from Epic Real Estate Investing says to write an offer to everyone. He uses a 3 option close, so, that's what I plan to do. My wholesaler partner says they are not deals and doesn't want anything to do with them. He wholesales only. I want to buy and hold these two and need practice writing offers. 

Here is what I have.

Property #1 is a SFR on the 200 block of Blue Ridge Rd Indianapolis, IN. Seller is not too motivated as he wants full price ($185,000) less discount for not involving a realtor and doesn't want to remain on the loan. Comps in the area are $185-190K. It's his only rental and want to be rid of it. Currently renting for $1450 but market rent is $850 according to Rentometer.com. I know I can rent for $1000. Owner owes $142,000 and monthly payment is $1275 w/PITI and $842 without. Repairs would be about $8-12K. How do i come up with 3 different offers?

Property #2 is a SFR on the 1200 block of N Holmes Indianapolis, IN. Seller owes $34k and doesn't want any profit. Just wants someone to take it over. Comps are $25,000-$45,000. Probably about $10k of work. Rent in area is $550 and I can rent it for $1000 for student housing because of an organization I work with. Monthly payment is $450 w/PITI. These are my first two deals I'm working on. How would I structure 3 different offers on these properties?

There are probably other questions that need asked and answered so please let me know what I'm missing. 

[Mike D'Arrigo]

@David Gunn I understand why your partner doesn't want to have anything to do with them. The Blue Ridge Rd property is not a buy and hold deal. You say that it's rented for $1450 but the market rent is $850 but you can get $1000. Wow. That's quite a range. You need to really nail down what the rent is but even if it is $1450, that's only a .7% rent to price ratio. There's no way this is going to cash flow. The N. Holmes property is in the Haughville area of Indianapolis which is a seedy, rough area that is part of the citie's "weed and seed" program for blighted areas. These 2 areas are very different from each other and very different property classes. In my personal opinion, I think while you're learning, it's better to stick to one class of property in similar areas and get to know everything you can about the area and property class. It makes it much easier to recognize a good investment and reduces your chances of mistake.