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All Forum Posts by: Wayne Hayward

Wayne Hayward has started 2 posts and replied 9 times.

Thank you all for your valued advise. I will take it all into consideration. May you all have continued success and i wish you and your loved ones the best of health and happiness.

Wayne Hayward

Thank you All. Coaching well received. I am new to this and value all of your advice collectively. I am grateful to the BiggerPockets community for participating and helping newcomers like me. Together we can all achieve greatness! I wish all of you and your loved ones good health and continued success in all your endeavors. 

Wayne Hayward

Prices. Thank you for your prompt reply. I appreciate it.

Wayne Hayward

I am an Electrician and i find that you need to have a 3 prong plug for the TP outlets to work smoothly. Yes they are a pain but necessary for child safety. I would keep them.

Wayne Hayward 

 I am still looking for my first flip. Florida's RE market is in a freefall. Do I want to keep looking in my local market or should I consider out of state markets? I don't see the ability to make a profit in this market. 

Please advise. 

Wayne Hayward

Post: when do you use the 70% Rule

Wayne HaywardPosted
  • Fort Pierce
  • Posts 10
  • Votes 3

Sounds good. 

New question,

I am checking listings in my neighborhood that my realtor sent me. The prices people are asking are higher than the comps. they are staying on the market longer now but How do I make a profit when the comps are at the 70% rule threshold?

Wayne 

Post: when do you use the 70% Rule

Wayne HaywardPosted
  • Fort Pierce
  • Posts 10
  • Votes 3

Thank you Drew. I appreciate your prompt reply and input. What should I do if I wind up having holding costs? Does the 70% - repairs not work? Please advise.

Wayne Hayward

Post: when do you use the 70% Rule

Wayne HaywardPosted
  • Fort Pierce
  • Posts 10
  • Votes 3
Quote from @Drew C Grossman:

@Wayne Hayward

The "70% rule" mostly applies to flippers and builders but really can apply to any real estate investor including long term / build to rent. It just means the total project cost goal needs to be under 70% of ARV (After Repair Value) or Market Value. For example.. working backwards.. you come across a cookie cutter 3/2 single family house in a neighborhood that needs some work. Fixed up its worth 300k....it needs about 50k of work to get it to that value...with the 70% rule you know you cannot pay more than $160k for the property itself. ($160k+$50k / $300k = 70%) The reason behind this (especially for flippers and builders) is you need at least 30% margin because that money is considered earned income when you sell short term and by the time you pay taxes you really are not making as much as you thought. You need to make sure you have a healthy margin for volatility in the market and also potential for increased holding costs if you are using short term leverage. Anything under 30% margin is considered skinny deal. I am using the 70% rule now for a build to rent / long term rental project.


Post: when do you use the 70% Rule

Wayne HaywardPosted
  • Fort Pierce
  • Posts 10
  • Votes 3

My name is Wayne, I am new to RE investing. I am hearing a lot about the 70% rule. How often is this rule used and what success have you achieved using it? Please advise.