How do I enhance my Deal Analyzer experience?

Question

Hi BP,

I am at the stage where I am analyzing deals on a daily. I was told when you first start off to start with MLS listings (Zillow, etc) My question is, how do I find a good deal that I can analyze on the BRRR Calculator when the deals that are on the MLS are already at market price (mostly)?

Angel G. · Answer

@Alexander Canalini - remember that the prices that you're seeing on the MLS are asking price and not necessarily reflective of what the seller's bottom line number is. The fact that you're running numbers and getting those "reps" in will help is a great skill to develop. Ensure that you have a criteria in place for what determines a "great deal" for you. Run the numbers and adjust to what works for you. Don't ever be afraid to submit as an offer price - you may get a lot of no's but all you need is that one YES to start building momentum.

Antonio Cucciniello · Answer

@Alexander Canalini I also struggled finding any good BRRRRs with wholesalers and agents in San Antonio, but the likelihood is higher

Michael Guzik · Answer

@Alexander Canalini Great question man I currently work with a few out of state investors and they all leverage other people’s knowledge. For example on this SFR I’ll be closing on hopefully in 2 weeks the investors leveraged my knowledge of San Antonio to make sure the home was in a good area and would appreciate in value and be highly sought after. He then reached out to the property management company to get information on rents, turnover etc for that area. After all of this and me running comps he plugged in the numbers into the BP calculator and the deal worked for him so we pulled the trigger. Now I’m today’s market we had to move fast and submitted an offer within 24 hours of the home being listed.

If you were doing this all on your own I would say to look on MLS and get on as many wholesalers lists as you possibly can. Coming from the wholesaling/flipping background has helped greatly with my knowledge on repair estimates, and instantly telling whether something is a deal. There really is no way around it you just have to look at more deals! It’s just like anything train your “deal” muscle and soon it will be strong!

Alexander Canalini · Answer

@Dan Maciejewski Wow, thanks! It helps me plug in the gaps where I didn't know before. I started playing around with the deal analyzer calculator and adjusted some numbers etc.. really enjoying that part of the process. I'm sure I will have a deal that I will post on the forums soon. Thanks for your advise!

Alexander Canalini · Answer

@Antonio Cucciniello Yeah it seems to be that way. I'll look more south like San Antonio to do my BRRR's and flip in the Austin area. Thanks for the input!

Dan Maciejewski · Answer

The MLS is fine.  Use FSBOs on Zillow, too.  There will be deals on the MLS, but they will be few and far between.  You will recognize them only after you have analyzed a ton of properties.  You will learn where the rents are actually below market, and what the condition of the property will command in rent.  You will start to see how $_____ in renovation can increase rents by $_____.  Then you can start to compare As-Is cap rates with exit/ARV Cap rates (or whatever metrics you choose to use to evaluate properties.  I like cap rates because it puts everything on equal footing.

You will also start to learn the differences between neighborhoods.  Mostly this is good for a laugh when the seller tells you that the "current" or "market" rents are 50% above reality, but it will let you know when there is truly an opportunity.If your wife is a broker, or you know an agent, get a search / cart set up where you can track the properties that you are analyzing to see what they are closing at.  Are they close to your numbers, or are investors overpaying?  You will also get a feel for what the market is bearing for retail end-user sales.

Steven Zamorano · Answer

@Alexander Canalini

I noticed most of my “calculations”have been coming from the MLS. I do get emails from some wholesalers, but they are pushing properties that are completely out of my price range. But it is a process. Staying focused and hungry man! We got this!

Antonio Cucciniello · Answer

@Alexander Canalini You get good at analyzing deals by analyzing them. At some point, the only way to know if your numbers were correct was to actually invest and re-evaluate, did the numbers work out as I expected? Where did I go wrong/right?

As someone who has been looking in Austin for a while (just moved there last month), its gonna be nearly impossible to find a BRRRR.

Its extremely difficult to find a rental in general, when you throw the BRRRR on there its even more difficult.

The best way to invest in that city is by flipping. Just my two cents!

Alexander Canalini · Answer

@Steven Zamorano

Thanks Steven!! So cool that you’ve been doing it as well. I’m about to finish Zillow Talk, book that the founders of Zillow wrote. Also reading Skip the flip, and my new book BRRR just came in! You’ve probably heard of that one.

Where have you been getting your deals from? Wholesalers or MLS?

Cheers!

Steven Zamorano · Answer

@Alexander Canalini

Hello Alexander,

I’ve been in the same boat. Been analyzing deals everyday. Adjusting and readjusting. Trying to make the numbers work. I’ve been analyzing deals for about two weeks and I love it. Just keep putting in the work and next thing you know you will be sending out plenty of offers. You will get plenty of rejections, but all it takes is one to get you in the door!

Good Luck!

How do I enhance my Deal Analyzer experience?

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