All Forum Posts by: William C.

No, it's a Federal tax reduction. I'd be happy to go over it with you, it's just way too complicated to explain right here. The long and short of it is LLC is the way to go, then the way that money is spent via there LLC, reduces your tax bill. It's legal, and simple, and may not even be a new concept to you, but having been an agent for 9 years was never told how or why to do it. But I am not an accountant so I can't exactly get into the weeds.

@Victor S. I already referred to the "local market conditions" in my first post. Quite frankly, I wouldn't be flipping houses in a market that is not absorbing property within the first week, of course assuming it was priced right.  But that's a discussion for another day.  This reply was to Lee who did not agree that the real estate market was efficient.  So I was just asking some questions in regards to the efficiency of most markets in the US right now. Pretty darn efficient.  Sure, hundreds of variables that lead to a sale,  Id argue its not the inefficiency in this case  Doesn't mean Im right.  BUT it's also my opinion that the buyers that are interested in buying this house have already seen it, saved it, and they are just going to wait until it reaches a price they think is market value.

Would be interested to follow this thread and see how it ends.  I vote price drop, now.  Let's hope Im wrong and he gets a full price offer today.  Only time will tell.  If you were a buyer, would you offer full price on day 21?   I just look at everything from the opposite perspective, if Im buying, I think like a seller, if Im selling I think like the buyer.

Just learned some very interesting tax codes that encourage LLCs. I will create an LLC tomorrow, and instantly reduce my income tax bill by $15,000. Kinda blew my mind I wasn't doing this already.

@Lee Nestlerode at the risk of starting an all out 'theoretical' debate about the efficiency of the market as a whole......I will simply agree with you that it is not on a marco level. But, a rehabbed home listed on the MLS in todays day and age, creates an extremely efficient market for those buyer and sellers. We could debate the rest of the market as being inefficient. But this house, easily comparable to homes around it, which needs no work for the buyer to move in, is plastered on the internet on 1000s of sites. A home buyer in that zip code, shopping for a home that is move in ready is well aware that he is selling a move in ready house. the further a home gets from new construction, and the further the sale gets from the MLS, the more inefficient the real estate market gets. But we are talking about pretty much one of the most efficient, straight forward deals out there. That is my point.

For example, do you really think the reason that home has not sold yet is because consumers are not aware it is for sale? I would beg to differ. I might be wrong, but that's been my experience so far. Does it have zero views on Zillow? My MLS can actually track how many buyers the listing was directly sent to. In other words, the EXACT buyer pool that is waiting for a home in that price range, and the listing is sent right to their inbox. Is that number zero?

So i don't disagree with you, I would just argue inefficiency in the marketplace is the last thing thing that is keeping this home from selling.  And DOM is a direct correlation between list price, and market value.   No one can "market" a home so much as to make it sell for more than it is worth.  Thats not to say, there isnt strategies you can use when listing a home that will help it to sell for more.   We are just well beyond that point a day 21.  You can only make a first impression once.  The secrets out, the market knows it overpriced.  Now its a race to the bottom.  

@Christina Linn I thought the OP was impressive, but to add a loan in there is nothing short of a miracle. You should call Guinness, because I’m certain that’s a world record. I’m lucky to get title in a week, and loans take about 15 days if we want to hustle. But then again that’s what we are trying to do. Why would you even want to close it a day, what’s the rush?

@Ray Johnson i don’t know if I agree with you point on net cash flow, because putting cash in and getting money back it the definition of investing. The goal of cash flow is not to get the cash back that I invested, it’s to create a flow of money in. I see what you are saying though. It’s been established we can’t compare everyone’s answers apples to apples. For example the guy making 500/door isn’t definitely doing any better than the guy at 300/ door. More variables, other than just “cash in” is going to skew numbers in either direction. It is still a metric we use to measure the amount of cash coming in each month and it is still interesting to see what others are experiencing in their business.

@Nate Sanow I'm right around $400 a door. When I'm looking at new deals my minimum is about $300 a door. Anything less than that and I'd risk losing a years worth of income to a bad hot water heater. This is small multi family or SFR. There might be some large scale apartment deals out there that make sense at $100/door.

I'd be willing to bet a large sum of money that when you do drop the price, one of the 4 buyers that already looked at it will be the one to buy it.  That is of course they have not already bought something.  Which is another reason it should be dropped now.

@Kyle Glasgow so much bad advice in this thread.

What is the supply and demand in your market? Are there other listings like yours, sitting on the market?

It is very likely you are experiencing a sellers market like the rest of the country. If this is the case, you as the seller are putting your home out into the market for those buyers to then come buy. If they don’t see value, they won’t buy. New buyers will not come along and over pay for a home that the market has already rejected.

If a home does not sell with 7 days it’s over priced.

List price does not determine sales price. If it did, we would just list it at a billion dollars, and we’d all be billionaires.

Homes sell for a little bit more, or a little bit less than market value. The way to get a little bit more is to have a bidding war.

So yes, contrary to what most people believe, your better off under pricing the house than you are over pricing.

Real estate is way too efficient of a market to allow for people to let a “good” deal go.

By not lowering the price, you are just delaying the amount of time it’s going to take to get the price you were always going to get. How many different ways do I need to say it for it to ring true. We don’t choose the sales price, the market does, so list price does not matter.

Some agents were really shaking the market up by listing homes for a dollar. Guess what they sold for....market value.

You cant make the house any nicer, its a flip.  Only other option to sell it is to....

Drop the price, and drop it a lot.  If it were mine I'd drop it about 10%, maybe more depending on the market.  Don't we all think if a buyer was willing to pay anything close to 10% less than asking, they probably would have already written that offer?  

@Irina Belkofer I completely agree.

That is why I was hoping to here OP's side of the story. It takes time to look up a property, its ARV, and then determine a "low ball" offer from there. I'm curious to hear how they are arriving at this offer amount. In order to send that many out a day, they either have a great system in place, or the offer amounts are just made up randomly based on an extremely low percentage of ARV. If its the former, I am looking to learn more. I need to find a cheaper, faster, better way to analyze properties. At least from a macro level. I have been thinking about outsourcing it. At least to separate the wheat from the chaff, then I can dig into the few that they are left with, and see if any of them are actually deals to pursue.