All Forum Posts by: Ken B

Hey Ctaie,

Just curious, but how long have you been doing your campaigns? And if it was done previously, what type of response rate were you seeing? Were you able to find any "low hanging fruit" deals that fit your criteria for your business?

I'm in the process of building my "team" now to get things going, but regardless of what all the guru's say, its does not seem to be a walk in the park by any means.

Sorry, I made an error, my mentor actually said to have the starting price at 25% of the ARV. lol

But seeing as how you mentioned that people haven't been getting bids much higher than the starting price is getting me a bit worried. Are these people you know personally? Do they post here or anywhere else? How much experience do they have with these type of auctions?

Im gonna call the seller in a few minutes, but I know its not really going to get anywhere since I don't think he is that motivated at the moment.

There are 3 other houses on the street that were all recently listed. Prices are 750K, 850K and 1.3M.

I'm curious to see if it sells.

Just throwing some ideas out here since I'm a novice that is familiar with the 5 day sale, although I never personally did it:

- Have you tried any other type of marketing besides online like newspapers, local flyers, signs, etc?
- How low did you set the price too? I recently heard from one of my mentors that with the market the way it is, he said he would put the starting price at 25% below ARV.

Just curious also, but how many other 5 day auctions have you done? And how well did they go? Also, you mentioned modified. What is different?

Thanks for the input Jon. You have basically confirmed what I believed to be true as well. This home is actually in a nice, upscale neighborhood of westchester with nearby homes listed anywhere from $850K to over $1M. Of course its just the asking price, and we all know how the credit markets are these days. The house that I was looking to make an offer on is smaller than the other houses on the same street in terms of square footage and land, although nothing dramatic. Throw in the fact that it has all original appliances/equipment and you are right, I think a reasonable offer from my standpoint, since I'm looking to wholesale would be $504K minus the estimated $100K that it would cost for a full rehab since that it would cost about that for a contractor to come in and do a complete overhaul here in NY with this type of house as well.

I have some specifics on this one particular seller that Im working with right now. This might actually be the first house that I actually buy. The ARV is coming in around $720-$730. Its a SFR, 4bed/3 full bath. 1 car garage, unfinished basement, sunroom, storage room, living room with fireplace, kitchen, dining room. The house was built in 1953. The house seems to be in fine condition, but everything in the house is all original equipment and needs updating.

The house is vacant and has been on the market for a few months at the least. The seller says that he is the executive for the estate, and that the house was owned by his uncle who passed away. He was asking $599, but now lowered it to $579. I'm thinking an all cash wholesale deal. I did ask the seller if he was willing to carry financing, but he said that since he has to answer to everyone else in the estate he would rather either do all cash, or the only way he would consider a carry back is if the amount financed was around $125 with the rest all cash up front.

If I took an ARV of $720, and went into contract with him for an all cash deal of $579 I am getting equity of about $140K, but that is at about 19% discount. If the seller doesn't budge from his selling price, is this wholesale deal worth the time? Or am I not getting it at the right price considering it needs major updating?

I know some people use the MAO formula, and calculate the 65%-80% of ARV, minus repairs. Im stumped. Should I be? Or does this deal sound reasonable?