Typical Buy Formula in Florida

[Grey Goodman]

Hi team. I am currently looking to wholesale/flip in Fl. I am being outbid on all deals as I am offering 70% of ARV less repairs. Do investors in Fl have a different buy formula ie 75%, 80% of ARV? I have encountered many flips in Fl where the price these flippers recently purchased these unrenovated properties for is closer to 80% of what the same flipper sold the renovated property for (this is not even taking into account repairs). All advice is welcome!

[Luka Milicevic]

@Grey Goodman

The 70% rule, and 50% rule, and 1% rule are all just blanket rules for any and every market. They might not apply to your market, the time in the RE cycle, etc. 

I have personally made some very good deals on renovations where I have profited extremely well and have never bought a house that was at the 70% rule. 

Given the competitive nature of the current market, what I have seen is that the better deals are going for 80% minus repairs. 

I have had so many out of state investors contact me that are new to the investing game tell me they are looking for 70% ARV deals. I tell all of them the same thing, if I find that deal there is absolutely no way I'm giving it up to anyone. I would be crazy to do so.

The best deals are going to come off your own marketing. If you are using wholesalers/agents, I would say you're competing against buyers that are willing to pay 85-90% ARV minus repairs.