All Forum Posts by: Devin Bivens

Hello community. I am in Virginia. A property was brought to me by a seller in Houston Texas. The street is Rice Blvd in the West University Place area. I have become a bit familiar with the area over the last few days, but would like input from more experienced investors/realtors in that area. The property in question comps out between 895k (low) to 1m (high). The property is a 3/2 vacant but in good condition..the seller bought another property for 2mil and moved to that one. As stated earlier, I am in Virginia and I am not looking to take this down myself and relist. I am thinking my exit strategy would be to get the contract, sell to investor buyer..and the investor buyer could do cosmetics and list on MLS for retail end-buyer. My question is, with regards to the Houston area investors, what profit margin is reasonable? This is not a trash house that needs a ton of work, its lendable, and already livable, just not listed. Any insight would be appreciated, thank you in advance.

Thank you for the reply @Evan Polaski. I would market these properties to landlords looking to add to their rental portfolios. I assume the potential landords would get financing. So I was basing my assessment on assumed.."money out of pocket".. 20%downpayment, closing costs, wholesale fee, then doing the calculation (annual cash flow/total investment), for cash on cash% based on those numbers. Most of the properties I am coming across have renters already in them. I do have a duplex I am working on now that is vacant. It will be a total rehab for a flip investor. And thank you for the reply @Jaysen Medhurst.

Ok thank you for the reply @Jaysen Medhurst. So instead of looking at the ROI, just treat them as regular wholesale. Does that include Quads? I know 4 or fewer units are residential, just wondering if having the opportunity for 4 doors changes the equation at all.

Jaysen, thank you so much for the reply. You make great points. This will not work as a deal for me as I am not doing rehabs. I appreciate your reply very much.

4-plex 100% occupied all mo to mo rental terms.

2/1 rent  600

2/1 rent 600

2/1 rent 575

1/1 rent 550

Rental income..$2325/mos tenants pay elec/gas; owner pays water every other month 360. Owner owes approx 105k (getting back to me with specific payoff amount) the property value is approx 125k. Owner is not interested in owner financing...owner is 84 years old and lives out of the state, getting older and tired. No major updates have been done in years..including a roof that is at least 15 years old. I know this will not work as a traditional cash wholesale deal, but would the rental income be attractive enough to a landlord looking for the monthly income? My original thought of a cash offer was around 62k. I am sure this will be rejected, just getting an idea of something I am not thinking of or is this a no-deal?

Can anyone see a reasonable offer that can be made? 

You don't have to have those things in order to start. I am just saying if you send out your marketing and get a call from a seller, what would be your next move? When I send out marketing I get calls starting about 2 days later, that is not the time to look for a script, property info sheet, contract, etc. If you have it already you are in a better position to chat, then head over to the house maybe even with a contract in hand just in case...Have you found your local REIA? Great free information and contacts there.

I am not sure how far along you are, but I would suggest you have a foundation to stand on. Forms, marketing strategy, title company, general idea of repair costs..are you going to look for properties yourself or have someone bring deals to you..i.e a wholesaler or do you have funds or access to funds to buy?

If you want to keep it simple, I would suggest just wholesale it to your buyer and collect an assignment fee.

Hey Kyle, what do you mean by jump into your first property? What type of exit strategy are you going to focus on?