Wishful thinking to buy equity in DFW now?

[Tom Lafferty]

I am sitting here with a pile of money wanting to purchase some SFH's as rentals using hard money. Ideally I'll buy something around 90-130K ARV that has at least 20K equity in it. Looking primarily for distressed (even heavily) properties, is this wishful thinking without becoming a full time wholesaler in order to find motivated sellers in terrible situations?
Apparently this was going on consistently even 6 months to a year ago buying FROM wholesalers and using realtors. I was talking to a hard money lender yesterday whom I trust completely and is a successful investor himself. He said even four months ago his customers were regularly ending up with 12-15K out of pocket on a 100K ARV. Now it is very common to need 20+ at closing. In FOUR months! Makes me feel like I'm late to the party....
All that to say, I'm trying to find a balance between putting the money I have into something now that is an OK deal, or hold out, start marketing for sellers myself, and wait for a really good deal with more equity.

[Carlos Flores]

Inventory is tight and made worse by new investors that will pay more and numerous firms in DFW that scour MLS. These firms tie up the property using relationships that allow them to get the house temporarily taken off the market or they put it under contract; then blast it out as a "wholesale" deal. Directly marketing to sellers is competitive as well. I was talking to a f/t investor the other day that spends $2500/mo on mailers. He said he started out spending close to $1k/mo and made a 6 month commitment. Took 4 months to land his first deal. That's just one person. There are lots of folks in DFW that send mailers. Definitely a much better option than MLS. I haven't given up on buy/fix/hold, but at this point, I've started talking to friends about investing in apartments, something in the 30+ unit range.

[Samantha M.]

Carlos F. Im having a tough time in DFW right now too trying to find more SFR rentals. I wonder when more inventory will come on the market, because right now its plastered.

[Tom Lafferty]

ugh. once again I feel sick at jumping in right now!
I'm also debating partnering on a larger apartment complex with the same money so I cant decide whether to tie it up on single family homes or not!!

[Andy B.]

Just read an article that said the inventory has really dried up in the DFW area -- more buyers due to better interest rates, plus investor, plus a severe downturn in the number of foreclosures being stated as the causes.

The article did not mention when or if it is expected to turn.

[Nancy C.]

Carlos F. I'm wondering if you would recommend that a new investor check out different areas because the market is so tight. Or can a newbie find a deal and compete? DFW seems to have everything going for it - including massive competition. Is my time better spent elsewhere?

[Jon Klaus]

There are deals in DFW. MLS might not be the pace to look. What's your specific criteria? The market heating up is not a bad thing. I really doubt we are at the peak right now.

[Jim M.]

Seeing this in the Charlotte market as well. Tight deals and multiple offers on the properties. Margins getting thinner.

[Carlos Flores]

Tom - I missed out on deals during the last 18 months as well. Many that I would buy in a heartbeat today. You just got here. Don't give up. As Jon said, I also don't think this is a peak.

Samantha M. he is doing both yellow letters and postcards. Sounded like the bulk were postcards.

Nancy Capron Like I said to Tom, don't give up. One thing I can say is don't get swayed with every passing wind. Whether it's here in DFW or elsewhere, narrow your options and focus.