All Forum Posts by: Michael Stole

If I signed an inspection contingency on a property being sold "as is", and defects were found during inspection, could I use that back out? Or all I can do is to negotiate for a lower price?

Another question. Does "as is" mean different things to REO and HUD houses. I know HUD-owned houses are ALL sold as is, and they are extremely firm on that: absolutely no repair, no inspection contingency, no negotiation related to defects.

So it suggests to me that banks are like individual sellers, who are negotiable and flexable on the term of "as is", while HUD is rock-hard on that.

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Originally posted by Charles Perkins:

I suspect the answer is yes. Lenders finding themselves in possession of property would have no idea of what has been done with a property and would want to limit their exposure to the unknown.

My agent told me he saw some REOs needing cosmetics work, but not listed as "as is". But he is not sure whether it is because the listing agent forgot to check the box, or the bank is indeed willing to pay for repair up to a certain budget.

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Hi, BPers, one quick question again. Are all REOs sold as-is? I would like to find some REOs that not sold asis, but don't want to waste my time and energy looking for something doesn't even exist.

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Sold 300k as new construction in 2007, current market value for a similar ready-to-move-in house is probablly 150k. severely damaged, selling for 60k, rehab cost 45k-50k (need all the repair work, a big conern to me). Rent around 1.6k-2k. Is it a good deal? :roll:

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I was told that HUD houses are often listed under "Exclusive Agency". Why doesn't HUD use the more popular "Exclusive Right to Sell"?

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Thanks, Joshua.

Originally posted by Joshua Dorkin:

Here are some resources for finding fair market rents.

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No, it is one of my properties for rent. My agent suggests to rent for $2k/month.

Originally posted by Kyle Meyers:

I think it really depends on more factors, the site just accounts for number of bedrooms and location is only judged on distance to the rental address you enter. In many cities I think the rents vary from block to block so the estimate may not be right for you. I would estimate that the rent you are paying is slightly more than the market rents are around the college and 20th area. Is that where you are? I looked a little online to see if I could find rents in that specific area, I found some rents for 5 beds there at 1.2k and 1 beds at 700, depending on the amenities and what utilities are included you may not be overpaying by much. Try looking for for rent signs by you and calling to find the rents.

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Thanks, John, for your explanation.

Originally posted by John Hostetler:

Originally posted by Michael Stole:

I have a few simply questions. Sorry I am a newbie. And thanks for any information.

(1) what is this "est ins 600"?

(2) Is one month vacancy in a year a good estimate? My guess is probablly two monthss vacancy is more accurate?

(3) "est. maint. 900". How did you come up with this number?

1) Insurance, I believe.

2) This depends entirely on the market. I am in San Diego, and vacancy rates are generally below 5%, and have been for some time, but I still count on 10% vacancy in my analysis of local properties. My point is that I like your thinking ... better to be conservative.

3) I can't answer this for the poster. The way that I would look at this is using the 50% rule. This "rule" is a guideline for estimating long-term TOTAL expenses for a property, not including financing. This includes vacancy/eviction allowance, taxes, insurance, property management, maintenance, utilities, and capital expenditures (BIG maintenance projects.) See my post just before yours for my take on it.

Hope this helps.

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Thanks, Kyle.

It shows my current rental of $2k for a 4 bedroom SFH near Martin Luther King park is way too high...

How accurate is that estimate?

Originally posted by Kyle Meyers:

Try rentometer.com

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I have a few simple questions. Sorry I am a newbie. And thanks for any information.

(1) what is this "est ins 600"?

(2) Is one month vacancy in a year a good estimate? My guess is probablly two monthss vacancy is more accurate?

(3) "est. maint. 900". How did you come up with this number?

Originally posted by Michael Lauther:

This is the way i would look at this property. I am sure that others with more experience will have more input. Based on the 50%/2% guideline i would start to look at this property at 42,500 minus the cost of repairs of 7500 so my offer would be 35,000.
If Im all In for 42,500 the numbers would be :
rent 850 x12 = 10200
Taxes 1253
est ins 600
prop mgmt 10% 1020
est vacancy 850
est. maint. 900
total operating expese 4623
Net operating income 5577
cash on cash return 13.12%

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All Forum Posts by: Michael Stole

Michael Stole has started 70 posts and replied 208 times.

Post: Are all REOs sold as is?

Post: Are all REOs sold as is?

Post: Are all REOs sold as is?

Post: Is it a good deal?

Post: Exclusive Agency for HUD houses

Post: where to find rental information

Post: where to find rental information

Post: Numbers look good to me...what do you think?

Post: where to find rental information

Post: Numbers look good to me...what do you think?