Buy or not

[Kerry Neal]

Hello, I am new to investing and I have 3 REO's that I am looking to purchase.
1. 695K - cost, 150K - repairs, 900K - CMA
2. 330K - cost, 35K - repairs, 430K - CMA
3. 395K - cost, 50K - repairs, 460K - CMA

I may be able to get a grant for all the repairs. So I was hoping that would make a difference in purchase cost. I need capital so I was looking to flip all 3 properties. I am aware that the 900K can potential take longer to sell, so I thought I would try to sell it through a luxury estate auctioneer.
Please help.

[Brian Levredge]

None of these fit the formula for flipping. Your maximum purchase price should be no more than 70% of the CMA less your repair costs, closing costs, etc.. Depending on your comps, you probably want to go with the low end range to be safe. Keep in mind you will also have to pay property taxes, insurance, sales commission, capital gains and a bunch of other fees/costs as well. At the end of the day you won't make anywhere near that 30% which is why it's very important to factor in everything in advance. I would suggest checking out the threads in this forum here:

http://www.biggerpockets.com/forums/67-rehabbing-forum

for more info.