All Forum Posts by: Lena Claybon

Hi BP Community,

I notice this question has been asked a couple of times before with no response but I'm hoping since then, new members have joined BP that may have experience in this area.  I have a seller who wants to sell his whole portfolio of rental properties (10) and he wants to sell them together instead of breaking them up.  I have buyers who are interested in that area but may only want to buy one or two houses each.  I think I can sell them all between all my buyers but not all to one of them.  How should I handle this?  Should I reveal to the seller that I'm a wholesaler and I have relationships with end buyers but need to sell each one separately or do I try to put them all under contract as I would a sf deal and just try to sell them to my end buyers before my 30-45 days are up?

Hi Freddy,

Have you heard of the 70% Formula for determining your offer price. It says that you should take the After Repair Value (ARV) of your subject property (based on what comparable properties in the area have sold for unless you have an appraisal), multiply it times 70% then subtract estimated costs of repairs from that number to arrive at the max price you should offer for the property. Keep in mind, this is also the max price you'll want to use to attract an investor so you really want to get the contract with the selle at an amount below this price which includes whatever fee you want to tack on. For instance, if you want $5,000 as an assignment fee, subtract $5,000 from the max price and that should be your offer to the seller. Make sure you give yourself some negotiating room so you might want to go another thousand or two below that just so you can get back to the price you really want. Hope that helps.

Thanks, Michael!  I appreciate it!

Hi Dustin,

I'm a wholesaler up in the Grambling/Ruston area who specializes in investment properties in college markets.  Please let me know when your next meeting will be.  Would love to attend!  Thanks!

Lena Claybon

Property Gems

323.289.6068

Okay, here goes... When I first 'attempted' wholesaling, I was in such a small market in Louisiana that I thought the smart thing to do was look for properties in the largest market near me which was New Orleans (and 5 hours away). I jumped on Craigslist, put the first property in N.O. that looked like a good deal under contract and thought I was on my way. The asking price was $70,000 and the ARV according to neighborhood prices was $150,000. Also, according to the seller, estimated repairs was only $15,000-$20,000. So, I figured, there was plenty of wiggle room between $90,000 and $150,000 for profit. So, I drove down to New Orleans and spent a week on my own dime showing the property to potential buyers. What I found was (a) the street the house was on was very nice but the neighborhood surrounding it was not (b) the estimated repairs was way off. The house would require more like $80,000 in repairs, not the $20,000 the seller quoted! (c) As if that wasn't enough, the house was in a flood zone! Needless to say, I left New Orleans with no deal, no house, and I was out of several hundred bucks spent on hotel, gas, food, etc. On the bright side, once I got home and recovered, I found a property two blocks over from my house, got it under contract and made $10,000 off it. Moral(s) of story: a. Know your market; b. Don't just go with quoted numbers, do your own due diligence, and; c. Its okay to start where you are. Sometimes the best deals are in your own back yard.. literally!

Great investment property only 2 blocks from University of Louisiana - Monroe (ULM). Needs some interior work to walls, interior and exterior paint, and needs new air compressor. Has new floors, new roof, new hot water heater. Will make great rental or flip.  Priced to go FAST!

Est. ARV - $75,000

Price $40,000

Est. Repairs $10,000

For more info, Please contact Lena Claybon - 323.289.6068 for more info.