All Forum Posts by: David H.

Like has been said if the numbers work it doesnt matter. Asking price is arbitrary right, it's worth what the market dictates and if it meets the numbers then it's a good deal. My guess is if others were offering cash above asking than it's a good deal!! And look at it this way, if you had paid $5k below you might feel better but realistically a $10k difference is like a 2percent difference and is really insignificant in the life of the property. You may not have gotten the absolute best deal but you cant let that get in your head and play mind games. The last two houses I bid on were foreclosures that needed alot of work. I bid a few k above asking on both and won both bids because I knew I was competing with cash and felt that at the price I offered I was still well below what I needed to make the numbers work. I'm still pretty new so I'm not saying this will work perfectly or is smart as I'm not certain yet but I tend to feel when your starting out and are competing with cash (which it seems to me you normally are on good deals) then sometimes we arent in position to get the absolute best deal and just have to make it work. Anyway, second guessing is normal but dont overthink it. And congrats!!

@Miranda Simon Haha, and I obviously am not good at that. I often think rules are stupid so go with my gut. Which can be ok but when it comes to basic stuff it's best to learn from people that have made it work and follow that versus reinventing the wheel. And realistically your gut probably isnt that good when you have no experience so best listen to the rules. Sounds like you already have that pegged. Anyway, I've learned my lesson lol...

Follow the big rules and follow your gut. The first deal I did was just prior to the 08 crash. I knew as it was happening I should unload it but went against my gut. I made it work but it was such a struggle I sat on the sidelines for 7-8 years. And the first couple tenants I let in my first 2 rentals were a major struggle. I didnt really screen them and one struggled to pay, the other was in the midst of getting caught in a real estate scam so he started doing heroin and trashed the house. All easily avoidable had I just followed the basic rules.

The real estate system is set up where it seems difficult to justify not using a realtor due to the MLS. I find in a normal market it's hard to get the best price unless you pay to get on the MLS and offer a commission. So then it's down to only saving 3percent. At that point it becomes a toss up whether its worth the extra effort to save that. And a good realtor is leaps and bounds worth that but I've not been able to find a good one for me. And I think it kind of sucks just paying a person that isnt that great just to get on the MLS... Maybe as things progress technologically it'll get easier to just do it on your own... which I hope

@Yusef Griffin Congrats man! You are right you learn a ton by getting in the game. You can read all you want, which greatly helps, but that experience is the game changer. I'm about to close on my 3rd investment property and I learned so much on those first two. A lot I did really well and alot really poorly lol. So you learn alot about your strengths and weaknesses, how you can improve and what you should leave to others lol. But that experience is huge and sounds like you have a solid gameplan!!

I guess with all the advice you have gotten the thing I would be thinking about is what is the downside and can you protect against it. If the market were to flip do you guys have the reserves to ride it out. If you wind up losing will it just be a setback or will it be catastrophic. Meaning will this take all your funds and leave you dry if it fails. If it were me and the downsides were too high I would wait. But it sounds like you are going in educated and are in position to make the choice that works for you

@Joe Splitrock So true, a really bad tenant can easily outweigh a year of vacancy!!

@Todd Willhoite This is the same way I am doing it. Seems to work well other than 2 closing costs but really no way around that unless it's a cash sale

I think it depends on how much experience you have, or how experienced of people you have involved. Also depends on funding you have available in case it goes over your estimates. If you have these things covered it sounds like a good deal. I've done a handful of renovations and this is probably more than I would take on at this point just due to my goals but I wouldnt be scared to do it if you have the right experience involved..

I think you can still compete without cash, you just dont get the best price. I won the last two I bid on by coming in slightly higher than I figured the cash offer would be. As long as that number is still below where you need it to refinance it and get your money back then it's still a good deal. Cash definitely makes it easier but it's still doable through lending