All Forum Posts by: Adam Marx

Good afternoon,

So I have made a verbal commitment on price for a home.  It does not need alot of work but a toilet is missing.  The current tenant says they have gotten the problem fixed but all that is required is some tile work and installing the new toilet.  Now the wholesaler is pushing to move this quickly.  I am looking to get an inspection done just to verify that the plumbing is not going to be an issue.  I do not feel that this is a ridiculous request.  I figured I am willing to sign saying I will purchase on the contingency that I am satisfied after an inspection.  So I am asking everyone's opinion on this.  

Also, the tenant is being given 30 days to vacate with 10k$ being held in escrow.  I am new to this and this would be my first purchase.  Should I run away simply on the fact that there is a holdback due to the tenant needing to vacate the property? Is there anything I need to be concerned about with the tenant.  I met him when I looked at the property.  I can't say I am worried he is going to destroy the property as he does not seem angry with the situation however I am curious what those with more experience my offer in advice.  Thank you.  Sorry I would go into more detail but I am trying to juggle a million things in a short amount of time but was hoping to hear your thoughts.  Thanks!!!!!

Thanks!

Let me explain specifics for you. 

The neighborhood is Cocoa Village in Brevard county FL. To the east is Merritt Island which technically I could find properties that sold within a few miles but Merritt Island houses do not sell for the same prices as the rest of Brevard County as it is a desired location so prices do not compare. To the north and west of cocoa village is Cocoa. Now the portions of Cocoa that are close to Cocoa Village are the rougher, higher crime, and ultimately less desirable areas of Cocoa as a whole. Right to the south is Rockledge which is a higher end neighborhood. The only two comps I have found that sold "recently" that are comparable size and location were sold in 21 and 22...which we all know was a market unlike any we have ever seen so I cannot use those numbers. As to a realtor...I had found one that is investor friendly but has just opened a new short term rental himeself and has been to "busy" all of a sudden to help me with comps. He knows I would use him when I purchase a home but this market has been tough and while I have offered to compensate him for his time till I find a property he would not accept that and said just use me when you find a home. I am now having to consider finding a new realtor which I think I just simply need to do but makes me feel bad as he has been very helpful in the past. The problem is if he isn't timely in helping me figure out the comps then the property is gone before I get a chance to make an offer as everything where numbers are decent are being scooped up quickly. This deal was found through a wholesaler who has been very active with me and this property is potentially for sale. The wholesaler gave it an ARV of 275 but I feel all wholesalers tend to be a bit heavy on the ARV price to make the numbers look good. I like this home, and this location especially as I have always seen them go quickly if one goes up for sale. The wholesaler asked me to send him what I think the ARV would be IMO and what profit margin I am looking for and then he would go and take a swing at the owner stating he wanted these numbers so he knows where he has to start with in negotiations so he makes his money and I can still profit in the flip. This deal is far from being closed but it is one that I have first stab at myself. I'm feeling guilty considering a new Real Estate agent but when his promises are not being fulfilled then I guess I shouldn't feel obligated in my promises to him but I try very hard to be a man of my word. The lack of experience is frustrating but every endeavor I have attempted I have excelled at with enough time and practice and I am not planning to fail in this venture either. It is just keep grinding till I find a property where I know the numbers will work and jump in. The 2nd one cannot be as hard as the 1st. Thank you for your response and I will update how this one goes...if it even gets off the ground!

Good evening,

So I have an off market property I may be able to purchase. The issue I am finding is it's unique location. It is in a tiny little town similar to a downtown district where you have alot of businesses with home sprinkled within. There are alot of amenities within walking distance and a nice park also less than 10 min walk. It is close to 2 major roads through the area. The issue is trying to figure out comps for this property. This niche area does not have alot of recently sold properties and the ones that have sold are condos in high rises not single family dwellings. If I look a few miles south you are in a richer neighborhood. A mile or 2 west and you find a much poorer neighborhoods. To the east is an island that holds alot of appeal to many so the comps there do not compare to anything in the rest of the county. It is just a property that does not have and comparable comps... What would be your suggestions to figuring out a accurate as possible ARV for this type of property? Should I just consider bed/bath and size and compare the median sell price across the area? Is there any tricks or insights someone may be able to provide me? Obviously the question is asked as your profit is made when purchasing the home and if I am off on ARV by 20-30k due to the uniqueness than I can find myself in a bad situation. I am green to this as I have made a couple offers on some homes, shown interest in others, but have not been able to land one yet. I am sure some of that is analysis paralysis but when it's your first, if I lose money on it, will set me back quite a bit on my planned timeline. Rebuilding the nut I have saved would be frustrating but I believe otherwise if I can get this house at the right price I would have no issue selling it. If I can figure out roughly what I can get for it in something more than a 50k spread that I have narrowed it down to at the point of writing this. I'd put ARV safely at 225-275 for what this size home is going for in the area overall. (Others have sold for higher but much more appealing locations and neighborhoods.) Any advice or ways you would go to narrow down any property you have looked at that simply does not have the normale comps to compare would help. Thank you so much. I look forward to posting soon on BP about my first purchase, struggles of the flip, and eventual selling of my first property!

This question comes from me finding a property that seems to be in decent condition for this type of property however it will need alot of work including a second bathroom if I were going to be able to sell it as current 3/2 prices. This would be required to make the numbers work imo. However I have never even approached a REO property. I guess the real question is this something I should just stay away from in general? I feel like if a bank has bought a property then they aren't going to be as open as a homeowner would be in selling the home for less than the asking price. At least, this is what I have seen the number of times I have been to an actual auction. So the question is more in the general sense or if someone has any experience in the particular arena could you provide some insight on providing an offer to the bank? If this question is not in the correct place I do apologize. Still new to the website! Thank you.

So how do you go about getting quotes for properties? My "mentor" can rattle numbers off the top of his head just due to experience but here I am not knowing so how would you recommend I figure out those prices? I guess maybe paying a contractor to give estimates perhaps? Just another cost to consider when looking at a property?

So I am not sure if it is better to post two seperate questions but these are two things I have questions about.  

I was considering writing letters to pre-foreclosures I find online offering to buy the property.  Has anyone had success going this route? I understand it is going to be a higher stress situation as the thought of losing your home can be overwhelming but I could see myself taking an opportunity of someone buying my house over losing it to the bank.  At least this way I end up with money in my pocket and I do not have a bad loan on my credit.  If there is something I am not considering regarding this please let me know.  Also, I have found some websites, along with a few listing through BP for some foreclosures.  If anyone in Florida knows of reliable websites I would be appreciative.  I believe I can go to the county as well and actually pay for a list? I know that can be done with cars so I'd assume the same can be done with homes. 

GC's - This question is more for learning to do the numbers. I am having a hard time getting GC's to want to help with numbers even if I ask for a range as suggested on the BP podcast. I am working on finding more GC's to help build those relationships but the most common answer I run into is give me a call once you are ready to purchase a property. I am simply attempting to figure out the FMV on repairs so I can practice working numbers on deals to get more comfortable with this prior to jumping in and purchasing a property. Again, any advice is appreciated. Thank you.

 I wasn't suggesting I was going to take a deal where I would break even.  Obviously finding one where I can profit would be great but in my mind breaking even is where I make a newbie mistake and have to fix something that was not considered simply due to ignorance.  The statement was more that I believe the knoweldge I will ascertain going through the process is invaluable in and of itself.  I will be at the local meeting which I believe is in 2 weeks. 

STR = Short Term Rental? I am open to any and every opportunity if the number make sense.

 Thank you so much.  I will have questions so I will reach out.  Haha.  Thank you again.