​Why/how is it possible to buy at 70% ARV?

[Kai G.]

I'm admittedly brand new at this, but I'm trying to wrap my head around how you're supposed to buy rental property at 70% ARV (or maybe 80%) after repairs costs. I do understand how that's rather desirable, giving you better cashflow, an exit strategy, etc. But I wonder how it's possible, because what's a good deal for the buyer is a 30% left on the table for the seller, and I wouldn't think too many sellers are up for that.

Here's what I can come up with as to how deals like that could happen:

• The seller goes FSBO and doesn't have much clue, so underprices the property. (but I gather that most people do FSBO because they're trying to get top dollar, so they're more likely to actually overprice).
• The seller uses a realtor/MLS. In that case, I'd expect that at least the realtor will have a clue, and not price the property way low. I suppose there is the occasional distressed/desperate seller who's willing to accept 30% below list, but I suppose it's hard to tell from the listing. So how would you find those? Make a hundred lowball offers until one sticks?
• Properties that get sold outside of the public (MLS/zillow/craigslist) market. But again I don't quite see why people would sell for substantially less if they could get more in the open market?
• I guess the exception I can see are properties that need substantial repair before being sellable in the regular market, because regular buyers would shy away from them, not get financing, etc. I can see getting a substantial discount there, though even that may be limited somewhat now, since rehabbing/flipping properties seems to have become rather popular since the last bubble / HGTV, so I suppose there's competition there, too. Anyway, personally those feel like too much of a risk for me at this point, as I don't have any experience with hiring/supervising contractors etc, and I suppose doing this the regular remodeling / general contractor way, any potential profit would go to the GC rather than me.

So maybe I'm missing something, but it seems that for a newbie it's rather hard to get those kind of deals on properties? (And of course that makes some sense, too, because otherwise everybody would be doing it...)