But all deals COULD work!

[Chris Cagle]

I am new to real estate investing and I working on analyzing deals.  There are three concepts that I am working towards trying to balance out in my mind.

1. Any piece of real estate could be a deal at the right price

2. No one is going to be selling real estate at the price I WANT to pay

3. I can look at comps all day long but at the end of the day I don't know what the seller's motivations are/what situation they are in

I have been mainly using Realtor.com because it's a super quick way for me to browse property and start to understand pricing in my market.  Obviously, 99.9% of listing on that type of site isn't going to be a deal but it's a great start to running numbers.

Let's say I find a duplex listed at $200,000 and the cash flow numbers don't work out.  I run them again at $160,000 and they look pretty good! (Concept 1)  Then I think, "What are the odds the seller would accept an offer for $40,000 less?  Probably not very likely."  But then that brings me to concepts 2 and 3... Well, no one is going to be selling something for what I WANT to pay,  because I want to pay as little as absolutely possible and the idea is to find motivated sellers.  I don't know their level of motivation so why not put in an offer and see what happens?

This line of reasoning would lead one to spend time on a lot of unlikely deals and isn't efficient.  At the end of the day, there is probably always some level of the above scenario happening but how do you all sort through all the hypothetically "could work" deals and spend time analyzing relatively more likely ones?