70% Rule for flip

[Scott Lepore]

Let's say you have a flip that has an ARV of 600k (in Denver that is approximately average house price now). 70% of that is 450k. Probably needs 60k MINIMUM for a nice flip. That means you have to purchase it at 390k. I find VERY few deals where you can have over a 200k spread on a 500k or 600k house. And exactly zero deals like that from wholesalers. Hometrust has never offered such a deal (their rehab estimates are laughably low) I would like to hear what other investors are finding that even comes close to the 70% rule and how you are finding them. Wholesalers? Your own marketing? MLS? Any insights much appreciated.,

[Matt M.]

I'm actually finding more deals now. It's easier than it has been if you are actually looking in the right places. I even found one on the MLS for the first time in 10 years!

And YES, you need a spread like that for it to be worth it, and really more than that. The overbidding saved a ton of investors over the last few years, but now those same guys are having difficulty or have been caught holding onto property from the big wholesalers. 

The "cattle call" wholesalers are notorious for bad comps, repair numbers, arvs, etc. I suggest you get your own leads or work with someone that can find those for you solely.  I don't see any deals from home trust, but I use them to gauge off market deal flow because of their size. I won't do any business with companies that have the initials NW. As always, do you own DD please!!