Finding that First House

[Christopher Blanco]

I am starting to get bummed and need a little pep talk or some advice. I have been looking at and evaluating houses in my area for fix and flip, I can't seem to find any that the numbers work on. I have started looking at the MLS, and my investor friendly agent insists that there are deals out there, just haven't found any that work. I am not geared up to do a direct marketing campaign, yet, do I need to be? Can some of the pros out there talk about finding that first house and the trials you went through?

I am getting bummed because my wife and I have found over 100 homes, I evaluated well over 30 of those, visited 10, but have made 0 offers as I can't get anywhere close to the asking price. My goal is to ramp up to doing 2 a month...if its taking this long to find ONE, I don't how I am going find 2 a month! I am calculating my asking price by taking:

ARV-(Rehab+PurchaseCosts+SellingCosts+HoldingCosts+Profit) = MaxOffer.

Am I just being impatient, or should I change tactics?

[Alan Russell]

Christopher,

My question would be, why do you need to be close to the asking price to make an offer?  I recently purchased a home for 35K that the owner originally listed for 60K, after about 1 month he dropped the price to 50k but those numbers still didnt work for me.  I made an all cash offer of 35k and after about a week of back and forth we were to far apart so I walked away.  Two weeks later he contacted me and asked if my original 35k cash offer was still good.

I work the numbers and make an offer for what I am willing to pay for a home.  If the seller can't or won't sell for close to that then I walk away and find another one.

Bottom line is if you don't make offers, even if you and your agent think they are to low, you could be looking for ever.  At the very least if you are justifing your offer by what the current owner is asking then you will probably wind up overpaying (IMHO).

Good Luck