how can I effectively grow my buyers list?

Question

I am just starting out and I am finding that locating and qualifying buyers is not as easy as they made it sound.  I am currently sitting on about 10 bandit signs that are ready to put up, and contemplating whether to do that or something else... any suggestions?

Matt M. · Answer

There are 100s of investors combing the MLS every day looking for a home to keep their crews busy or money in play. If they can make $10k or even less, they will buy it. For me anyways, it just isn't worth my time competing as I look for deals with significantly more meat on the bone. The last flip I looked at on the MLS got bid up $100k over ask. I was $25k over.

Lean on your agent to help you. If he or she won't, find someone who will.

Sandra Bivin · Answer

I have so many questions I dont know where to start... one thing I cant figure out is why these "good deals" arent good deals... all the numbers work on this, and its still not a good deal?  I just dont get it... what am ai missing>  Can you share your spreadsheet so I can use it to move forward?

Thank you so much!

Sandra

Sandra Bivin · Answer

the price was just reduced...I  thought  maybe the lower price was helpful...

Matt M. · Answer

What are you trying to do with the home? Wholesale it?? You are not going to find "deals" on the MLS as a newbie. If it hasn't sold at $270K, what makes you think you can sell it for $275k??

Quit wasting your time on the MLS. Put up those signs, drive for dollars, and find your own deals. If you find something, I can help run the quick numbers. I've got enough buyers to handle any real deal you find.

Jay Jasunas · Answer

@Sandra Bivin

I think @Gabe Amedee hit a very good point about how you could flip the house for $270k when its been sitting on the MLS for 5 months at that price.

Now if you could pick it up for low 200s then that is another story, there might be some meat on the bone for you.

I'm in Denver and would be glad to give you my assessment of the property and ARV. Just pm me.

Gabriel Amedee · Answer

I don't know your market but the fact that it has not been picked up rapidly is a dead giveaway that this is probably not that much of a crazy deal that you think it is. You are going to resell it at 250/260K, you don't think any cash buyer has offered that already in 5 months when its been listed at 270K?

Like honestly stop and ask yourself if the property sat on the market for 270K for 5 months, what are you adding to the property that you feel you can sell it for the same price in a 30 days or less?

A property that needs an extensive rehab that cost upwards of 70K needs much more thought out calculations and your 75% formula will not suffice. You really need to read the book on flipping houses by J Scott and understand the perspective of a flipper if you really want to provide value to them.

This is all the things my calculator puts into perspective for my own flips. My numbers, especially interest, may not replicate that of your investor pool so find out what people in your area are paying for interest, commission, etc.

Feel free to reach out for any other questions. Happy Investing!

Sandra Bivin · Answer

This property is listed at $270K, plans are already drawn up to cost between $130-170K rehab (it has extensive fire damage and will be expanded from a 548sqft 2/1 house to an 1800sqft 3/3 trilevel.  Comps show it could go for somewhere between $575k and $625k ARV.  I want to offer $250 (up to $260K) I want to sell for $275 (no less than $270k)

600000 * .75 = 450,000 - 170000 = 280,000 - 10000 = 270,000   as minimum allowable offer...

the training program taught us to use .8 for buyers margin - but in this case, i assumed it would take a bit longer to complete reno - so I changed to .75 - giving them a little more room to breathe... I also used the midrange ARV amount.  I believe that the only reason this house has sat on the market for 5 months is because of the holding costs... but I can't figure out how to move forward..

The RE agent I am working with told me that they don't broker owner will accept an offer from an LLC and/or its assignees, so they said I should either do a double close or buy with my llc and sell my llc...

I AM DESPERATELY SEEKING ADVISE FROM EVERYONE WHO READS THIS - PLEASE HELP ME!

William Allen · Answer

@Sandra Bivin, sure.  Better yet, post it on the forum here and get more than just my take on the numbers...

Antonio Coleman · Answer

@Sandra Bivin bandit signs are great if your city is not crazy about flea market of signs on every corner. Some places have tolerance, but some just are too strict on this form of marketing. It's a great way to build a list if you not only include your number but a website also to get people to opt-in for something.

how can I effectively grow my buyers list?

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