Multiple Offers within Days
Receiving multiple offers within days of listing a property and then getting under contract, to many Flipper investors is a dream come true!
A couple months ago a Facebook friend Flipper, an Investor out of Texas, showed a video and was crowing about their success! They purchased the property wholesale, they renovated the property and despite being over budget within a few days of listing they received multiple offers and put the house under contract. They were overjoyed .
They responded that they were a little nervous because the renovation was over budget.
Fear Flipping
My response is show me a renovation it does not go over budget! Invariably you get hit with a few surprises and things always take longer and cost more than what you originally anticipated. That's normally something you take into account during the planning stages.
Flipping Houses Gold in Las Vegas!
So I go back to my original question;
My answer is an unequivocal, no doubt about it gigantic yes!!!!
And why do I say this?
Now it may have taken four months five months six months, but the property did eventually sell. Which shows that given enough time and enough eyeballs, a buyer of a property eventually comes along that will pay the price for the right property. All we have to do is wait. I do realize that we do have to take into account the cost of money, as well as, the cost of lost opportunity in moving money along. However in most instances, you're still ahead holding put for the higher price
To add another perspective on this; I was looking at a hard money lender's loan application and a question was, if you would be selling the property at below market to ensure a faster sale?! Really?
We should be commanding a premium and should not be priced at or below market. Unless you are part of the ******, cheap, add no value,
rehab club and there are quite a few of you out there. This is Flipping out Fear!
I have demonstrated over and over again with my sales, my brand-new renovations in established neighborhood fetch a 20% to 30% sometimes 40% premium over market comps. Now I'm not saying throw caution to the wind and offer more for the deal, or spend more money on renovation.
I'm saying, if you have completed a renovation where you have added value and it is a renovation of that you feel proud of, then by all means price the property to the moon. Once you list the property you can lower the price, but it's very difficult to raise the price if you priced it too low.
I've written about my earlier experiences when I first got into this business. I listed a property we received multiple offers within three days. We accepted one opened escrow, and then a day later received a much higher offer, too late. I left money on the table! I vowed that this would never, ever, happen again.
How do you explain selling a lecture he home in a gated community at $131 a foot when the closest comp in the area was $109 a foot? Picture above, Aegean Front Buy $252,000 sell $395,000!
Going back to my Facebook Friend, my personal opinion is that my friend from Texas left money on the table, that's what I told them. Of course they immediately unfriended me!
So goes the World!
What Do You Think? Did they leave money on the Table?
