All Forum Posts by: Jennifer Talcott

A home inspection will only tell you some of the problems the house has.  But, it may not find everything, and it certainly won't keep your contractor honest, or motivate him to show up and get the work done - on time.

From a realtor's perspective, the relationship with the contractor should definitely have been disclosed.  I probably wouldn't have given you the contractor's name at all - too much conflict of interest liability.

Aside from the obvious risk of doing an out of state rehab, I personally wouldn't use the contractor recommended by the agent because the trust level would never be there.  And, from what others have said about Milwaukee it sounds like you might want to try to get out of the contract...

Hi James,

Personally, I'd love to use wholesalers.  I'd like to have pretty much anybody bring me deals.  Unfortunately, the handful of wholesalers I've talked to haven't had a good grasp on what a good deal is for a flipper.  And, now that I think about it, after I explained to them what I was looking for, I never heard from them again.  lol

Anyway, to use your example:  85% of market is typically only a bargain for us if:  the property is in a higher price point location; it will sell quickly; and it doesn't need any work (or very little).  Obviously, these properties are not easy to find.

One of the reasons we need to buy so low is that there are more costs associated with flipping than just the rehab.  For instance, there are also transactional and holding costs - especially when hard money is used.  

Now, if I was buying and holding, I imagine that 85% of market would probably a good deal.  Because in that case, I'd be more worried about cash flow, and the price would only factor into my exit strategy; not so much my business operations.

So, if you know anybody in the east Tampa area who is really good at finding flipper-friendly deals, feel free to send 'em my way!

@Brian Gutierrez       I hadn't thought about that angle.  Thank you for the advice.

I have a lead on a potential short sale property with equity, and I was planning to talk to the owner to see if they would be interested in selling to me.

My question is: What do I say to them if they ARE interested?  What questions do I ask?  What information do I give?  I'm a realtor, so I can put the deal together, but I mainly deal with retail for my clients.  What kinds of questions are short-sellers likely to ask me?

If you read the Ultimate Guide, it gives the 70% rule, which is a quick rule of thumb.  But it's pretty accurate.  I've calculated things out the long way on several properties, and they typically turn out to be 65% to 85%.

As far as estimating rehab costs, it probably wouldn't hurt to start talking to some people to get an idea of the costs.  I'm too new to have a lot of experience in this, but other investors in the area have told me to assume a minimum of $20,000 for rehab.

I vote for the taupe first, and the slate blueish gray second, with white or eggshell trim. 

Don't go for "personality" colors like rust or yellow, or even green.  Neutral colors will appeal to (or at least not turn off) a wider number of buyers or renters.

@Crystal Smith

Thank you so much for the suggestions.  #2 - Offer good till sold is one I haven't heard of, and it's a great idea.  I also think my inspection period is probably too long (10 days).  But I don't want to cut it back to less than 5 days, so I can give myself time to research for sinkholes, liens, etc., and to inspect.

How fast is a quick close do you think?  I've put in 3 weeks just to give the title company time to do their thing.  But how long does a title company really need?

You may want to clarify some things in order to help yourself find your answers.

1) What is your exit strategy?

2) What is the real ARV?

3) What are the eviction laws in your local area?

4) Make certain there are no repairs.  A son who is willing to let his fixed-income mother go to work to pay his bills is very possibly not taking good care of the property.  So, you need to know the true costs of the repairs, or whatever else it will take to get the house sold/rented.  Did you get a chance to get a good look at the house - inside and out?

5) What are the true buying/selling/holding costs of your exit strategy? (closing costs - buying AND selling, realtor fees, cost of borrowing money, property taxes, insurance, etc.)

These are some of the questions off the top of my head, but I'm a newbie, so there are probably a lot more things that I haven't taken into account...

Congratulations @Brandon Proctor !

First step is gettin' in the door, right?

I can't speak to Wyoming, but your realtor should know whether or not there are asbestos disclosure laws there - It might even be something that is addressed on the standard Seller's Disclosure.  Use a realtor who has done lots of deals and has the experience - Running comps and finding the right list price is more of an art than a science and can take more time than you might think.  Also, a little advice from a realtor's perspective: give her the opportunity to list your property.  Nobody likes being used to do free work for people.  

I hope you wind up making lots of money on this deal, and many, many more :)

Yeah Aaron, the Tampa REO market is getting brutal/stupid. You really can't make money in those situations.

Did you check out the Tampa foreclosures link that @Dave Bingham posted on this thread?