All Forum Posts by: Andrew Tolleson

Hattie, that's exactly what I said...ha.  Thanks for clarifying though.

Hattie, was that 70% minus repairs minus your wholesale fee? So if it's a 100k ARV, you bought it for 70k - 20k repairs - 5k wholesale fee = 45k? I know the numbers may be different but is that roughly your scenario?

@Rocky V.

Thanks.  Yes, the last couple deals I did were 3 months to the day from purchase date to close date.  That won't always be the case.  I choose to deal in higher ARVs for the higher profits, but of course that's also more out of pocket on the typical deal - more risk as well.

By "wholetailing" I assume you mean you're doing the rehab and selling to a cash investor for a slight discount to market, and their advantage is a turnkey property?  I'm new to these forums so please forgive my lack of term knowledge.

If you made 28k on a 100k deal that's phenomenal. 

Thanks again for the replies to all.

Rocky, are you talking about properties that have ARV's of 100k or properties of higher values where you have 100k or less out of pocket? Just to clarify your last statement, a 50k profit on a 400k ARV would be 12.5%. Realizing that your return could be anywhere on the scale depending on what price you purchased the property at. So if you purchased it for 230k and it needed 50k jn work, that would fit the 70% rule.

My initial question could be better framed as this:  Is anyone in the DFW area buying properties at the 70% minus repairs number?  You don't have to disclose where you get them, but I'm curious if anyone is having that kind of success, or better, in the current Dallas market where the margins seem to be squeezing profits.

Thanks again

Oh, and Hattie....no relation to Shawn...sorry!

Thanks for the replies guys. I think for simplicity's sake it would be better to refer to profit as a percent of sales price. I know the standard formula, or used to be, was to offer 70% of ARV minus repairs. The 70% takes into account closing costs and profit, etc. So regardless of whether you pay cash or use financing, we're talking apples to apples.

I realize in the hot market it may be difficult to purchase every property at such a steep discount as to realize a 20% profit to sales price ratio.

I've done a couple flips in the 400k range in the Dallas area lately and am curious what kind of return other investor/flippers are seeing in this market.  Its almost October now and the market seems to have softened a touch, but DFW has great job growth coming as a driving factor so the market should remain one of the best in the country.

I was told I should be making 20%.  But 20 % of what?  Should I be netting $80k on a $400k sale price?  What are you seeing as a net profit on your flips after all expenses including rehab, realtor, closing, and holding costs?

Thanks so much.