All Forum Posts by: Eddie Egelston

Well if the wife is a Realtor, she should only need about 5 minutes to pull comps and make educated adjustments. At least enough to know if you should go into the trouble of evaluating further and going to see it. Hopefully subject property is not in a low density area and too different from others. That adds ambiguity.

I don't know any investor that would base their rehab estimate off of MLS pics. You must walk the property first. So in that way, the post was made too early.

If you have rehab knowledge and she's a Realtor you're the perfect team!

Best deal I ever saw on MLS was an almost complete house. House needed about $20k to finish. The folks that bought it must have cleared $60k profit for a few weeks of work. Risky thing about, it was owned by a druglord who had the house taken away from him through 'forfeiture'. I would have been afraid who might have come back to the property :/

This is "solid"? You guys move around $300k to *hopefully* make $11k? This sounds light relative to the returns most folks on the website often say they are looking for. I personally wouldn't move around that much money for double the $11k.

You did seem to pad some of the estimates. 8-12 weeks to sell sounds too high. Why wouldn't a property priced to sell take half that time?

I personally wouldn't welcome someone "making an appointment" at my office to discuss my un-listed personal real estate. Not saying you shouldn't reach out; just not as written, verbatim.

2 cents

 LOL! I didn't "rush" to tear this apart. I search forums for "unanswered" posts and try to help people who are not getting answers. Yours was 2 hours old with no replies.

I went out of my way to say I wasn't trying to be mean- knowing that tone etc does not come through on screen.

You ask for feedback you got feedback. And it seems I guessed correctly that a CMA was not done, but rather a "CMA tool" was used. You won't need to hear from me those things are often trash.

Also I did not disregard the entire post; I acknowledged you may have found a deal. You will be well served to run a proper CMA to know more about it.

Those terms appear very normal for a first timer. When I was shopping, that's what I was looking at. In my experience I am so glad I did not do hard money on my first and second flip. Holding costs would have put me in the red. If you are smarter or more experienced than me you may be able to beat the odds. Lombard's a great market IMO.

No CMA ends with the house being worth $xxx,xx and 8 dollars. So what did you actually do? Use some BS push-button AVM? "No value adjustments"? So basically you didn't do a CMA. You *perhaps* gathered comps.

I'm always leary of rehab estimates that are so round. $20,000 eh? Hopefully that's material and labor, or else that explains a lot of the "deal" right there.

Not trying to sound mean, just realistic. I can vouch for the idea that a 90% complete project carries very little value on the open market. People either want turn-key or fixers. Not a lot of room in between, so you may have something here.

Some pictures might aid in getting opinions. I'm not picturing how else someone would get to a 2nd floor unit besides stairs.

Is the garage on an alley behind the property, or is the garage that would normally be close to the main street simply behind the house?

I've seen a garage placed too far behind the house absolutely kill the value of a house. My client's 2 car garage was at the top of a steep driveway, with about half of the garage behind the house. Both cars could pull into and out of the garage, but it was tight for the one car. It was akin to parallel parking, and an error would cause you to hit your house. Pretty sure the house would have sold for $175k or more without the issue. It sold for $165k. So that took 6% or more of their value away.

@Walter Roby jr well then just to continue the discussion... I don't see the logic behind the investors decisions; or the chart and it's explanation has too many inaccuracies. Cash is king as we know, and with an unlimited supply to invest, any of us could begin living passively asap. So assuming these investors do not have millions of dollars of their own to invest, why would anyone flip one $600k house, when the profit is "$45k" when they can flip three $200k houses and make "$120k - $150k".

That would make the ROI of $200k houses between 20% and 25%. Why would any investor settle for 7.5% when 20% or more is available to them?

I do not know much about Encino California, but if the majority of homes are around $600k aka 8x the median California household income, then perhaps expressing that there is a low quantity of buyers near $200k is inaccurate. Perhaps more accurately there are very few properties that have an ARV around $200k. Not few buyers looking to purchase.

Regarding high end properties, "margin" is much different than ROI. It goes without saying that flipping something at 1.2M needs more margin than 600k; not sure if it requires higher ROI.

Either way, ROI is a poor metric to express flipping profits imo. Annual ROI is much better. The average flipper takes 1 year to get into and out of a house. To require $600k to make $45k per year is pretty meh compared to someone who could get into and out of 2 houses a year, literally doubling their profit to $90k a year.

With all that said, I think the chart and it's explanation leave a lot to be desired. What value or goal are you looking to accomplish with the chart?

This is standard procedure for a short sale. 3-6 months should have been your general expectation, unless told otherwise. In case no one else has told you, you are essentially negotiating with the lien holder or bank. Judging from your tone, it sounds like you want the bank to rubber stamp the "deal" you have with the seller. It's the opposite.

You hope the seller will rubber stamp the deal you make with the bank. You're half way there!

Pros

I have yet to see a HOA that bans "investors" from buying. It's "landlords" i.e. tenants they don't want. I have found these to be good flip opportunities since most "investors" are not allowed to buy for their purposes.

Less to fix and maintain than a SFH. Small interior and you are done.

Cons

I can't effing find any in my market

Many condos tend to be cheap places to live. That sort of buyer isn't usually the one looking to pay top dollar for brand new finishes. This often creates a "floor" and a "ceiling" for prices that is sometimes hard to fit your margin into.

Many boards have a right of first refusal, so in theory they can take your deal from you. Unlikely though.

In a big city like LA I assume they are building new condo buildings as we speak. Might a nearby new building open up before you can get into and out of yours? That might put downward pressure on prices.

May be challenging or more expensive to get work done in unit. May have to reserve elevators, keep noise down or use specific building materials.