OFF MARKET DEALS, COMPS & CURRENT APPRAISAL NUMBERS - FEW THOUGHTS

[Vijaianand Thirunageswaram]

Hello BP REI's

Hope all doing good. I do not see lots of action these days in the forum. It's been quite. Whether you believe it or not, deals are still happening even with high interest rates. Whether you want to be part of it or not is the questions. As I always say, you should be in market whether it's going up or down as value investor. Real Estate is considered inflation edge all the time. 

Anyway, let me share some thought about the topic which I been experiencing in the last few months lately. As the inflow of OFF Market deals starting to increase in the last few months, that's good news for investors. But watch out, many wholesalers are trying to sell the properties with the 8-9 month CMA which shows really big spread. That's not the going to work with the current market as the prices have dropped atleast 10-20% in many areas.

Let say you buy it and rehab the property and going for refi, appraisal going to be pretty different with the lastest comps and not the 8-9 month comps. That's going to really reduce your LTV and end up putting down more from your pockets. So word of caution to really do your due diligence by taking the real last 3-6 month comps from your agent not use the Wholesaler comps to make the deal happen. This is especially true to the recent shift in the market due to the interest rates and continue to change and will continue this year.

Happy to hear others thoughts.. 

Vijai