Near Miss (by DanNBoston [MA]) Aug 6, 2017 5:19 AM|
Near Miss (by NE [PA]) Aug 6, 2017 6:01 AM
Near Miss (by Susan [OH]) Aug 6, 2017 6:09 AM
Near Miss (by WMH [NC]) Aug 6, 2017 6:11 AM
Near Miss (by NE [PA]) Aug 6, 2017 6:13 AM
Near Miss (by NE [PA]) Aug 6, 2017 6:26 AM
Near Miss (by Steve [MA]) Aug 6, 2017 6:29 AM
Near Miss (by Susan [OH]) Aug 6, 2017 6:30 AM
Near Miss (by NE [PA]) Aug 6, 2017 6:34 AM
Near Miss (by Susan [OH]) Aug 6, 2017 6:47 AM
Near Miss (by NE [PA]) Aug 6, 2017 6:49 AM
Near Miss (by Richard [MI]) Aug 6, 2017 6:54 AM
Near Miss (by Susan [OH]) Aug 6, 2017 6:54 AM
Near Miss (by NE [PA]) Aug 6, 2017 7:04 AM
Near Miss (by RB [MI]) Aug 6, 2017 7:10 AM
Near Miss (by Susan [OH]) Aug 6, 2017 7:36 AM
Near Miss (by NE [PA]) Aug 6, 2017 8:00 AM
Near Miss (by cjo'h [CT]) Aug 6, 2017 10:12 AM
Near Miss (by Deanna [TX]) Aug 6, 2017 10:39 AM
Near Miss (by Blue [IL]) Aug 6, 2017 11:00 AM
Near Miss (by DJ [VA]) Aug 6, 2017 2:53 PM
Near Miss (by RentsDue [MA]) Aug 6, 2017 6:32 PM
Near Miss (by cjo'h [CT]) Aug 6, 2017 7:28 PM
Near Miss (by BRAD 20,000 [IN]) Aug 6, 2017 11:38 PM
Near Miss (by Susan [OH]) Aug 7, 2017 4:33 AM
Near Miss (by DanNBoston [MA]) Aug 7, 2017 6:06 AM
Near Miss (by R [OH]) Aug 7, 2017 9:50 AM
Near Miss (by Chris [CA]) Aug 7, 2017 9:05 PM
Near Miss (by DanNBoston [MA]) Posted on: Aug 6, 2017 5:19 AM
Got a Call from a bird dog about a "cheap fixer " duplex FSBO. Out of my usual farm. C neighborhood. Nice lot.
Bird dog sends me a video, says the place probably needs about 30 K worth of work to make it rentable.
Asking price is 25K. I offer the estate 8K. We settle at 10 K.
I'm thinking a home run ! My Total cost would be approximately
10 + 30 + misc. closing costs and rents would be $1500/month.
A no brainier and blows away the 2% rule all day.....
Then realty. If it sounds too good to be true........you know the deal.
Walked the property with my contractor, main support beam is rotted and the house is listing. Kitchen sinks are draining directly into the dirt basement. And many more major issues. Contractors estimate to fix this dog = 80-85 K. Ouch. He said walk away..
The landlord in me still feels like I can do something with this property.
Maybe offer $500.00 and sell it for the land value ?
Any thoughts ?
Near Miss (by NE [PA]) Posted on: Aug 6, 2017 6:01 AM
Offer $500?!?! That's my kind of deal! Offer $500 and sell it on Craigslist to a newbie for 10k. --74.47.xxx.xxx
Near Miss (by Susan [OH]) Posted on: Aug 6, 2017 6:09 AM
"Offer $500 and sell it on Craigslist to a newbie for 10k"
Yeah, let's all S C R E W the newbies!
Just don't do it on Sunday, until after church!
Glad I don't need money this badly.
Near Miss (by WMH [NC]) Posted on: Aug 6, 2017 6:11 AM
Once you know the issues, you have to disclose...just sayin'.
Problem as I see it could be liability. If you buy, and the house falls down before you get it sold...
And how much are your costs to get rid of the house if it were to be condemned? --173.22.xx.xx
Near Miss (by NE [PA]) Posted on: Aug 6, 2017 6:13 AM
In real estate, make money when you can. Just don't break the law. Selling to a newbie is not breaking the law.
Susan, have you ever sold an old car with problems?
Near Miss (by NE [PA]) Posted on: Aug 6, 2017 6:26 AM
Ok, maybe don't sell it to a newbie for 10k. Maybe sell it for 10k on Craigslist to an investor that enjoys a challenge or a first time buyer who wants to fulfill his American dream of remodeling his own home, but if a newbie comes along... and the cash is green.... --74.47.xxx.xxx
Near Miss (by Steve [MA]) Posted on: Aug 6, 2017 6:29 AM
What part of MA? As a GC these are the types of properties I love to find. About the only time I walk away is if they are on septic as i find those costs hard to contain.
If you can get it cheap enough & the area is suitable to rent for a decent price. Have your local FD use it for practice (builds good will & can be a nice tax write off). Then demo & either sell the lot or put up a modular duplex side by side & rent
Near Miss (by Susan [OH]) Posted on: Aug 6, 2017 6:30 AM
NE-an old car with problems? I've sold one-but just to the junk yard.For parts.
And as WMH said, once you know, you must disclose.
And as I said, glad I don't have to take advantage of "newbies". We ALL were newbies once. --76.189.xxx.xxx
Near Miss (by NE [PA]) Posted on: Aug 6, 2017 6:34 AM
It's not a matter of taking advantages of newbies. Is a matter of analyzing a property and using it to its max potential. If Dan in Bostons only option with this is to wholesale out, who cares who buys it?
I sell old cars. Buyer beware. Someone gets a deal and puts some money into it. Happens everyday.
When a career landlord starts to sell off his inventory, does he sell his geese that are laying the golden eggs or the non performing ugly ducklings?
That's right, a career investor or a sophisticated investor is going to dump his dogs. This is absolutely no different, not at all.
Near Miss (by Susan [OH]) Posted on: Aug 6, 2017 6:47 AM
NE, I think thou doth protest too much. --76.189.xxx.xxx
Near Miss (by NE [PA]) Posted on: Aug 6, 2017 6:49 AM
Susan, I think thou hasn't much argument against wholesaling this property to whomever will buy it. ;) --74.47.xxx.xxx
Near Miss (by Richard [MI]) Posted on: Aug 6, 2017 6:54 AM
Did you consider that the contractor may have inflated the price to get you to drop out so that he can buy it himself?
As a contractor for over 20 years, I could fix those things quick and easy,no problem for a fraction of that number.
One thing I've seen over and over is new investors who just want to paint and carpet and make fast money. They walk by major profits because they get scared away by stuff like this. About the only thing I'd walk from is a place on a bluff which is sliding into the sea. --66.188.xx.xxx
Near Miss (by Susan [OH]) Posted on: Aug 6, 2017 6:54 AM
How about this for an argument?
"Do unto others as you would have them do unto you"?
Near Miss (by NE [PA]) Posted on: Aug 6, 2017 7:04 AM
Susan, when I first started flipping houses, I bought a foreclosed 3/1 ranch with a rotted main header and rotted floor joists. We replaced the header and the floor joists and then remodeled the house (after it was safe to walk in.)
We made $30,000 when it sold.
Did the bank care how much experience I had?
I think you're hung up on selling it to a "newbie" part.
I don't care who buys it.
It has nothing to do with ethics and I'm sorry you want to take it that route.
It's a $10,000 house. If they want a house that's straight and has a main header that isn't rotted, let them pay $30,000 for something else in better shape.
I look for deals like this. They make money. Whether I reselling them to a ready, willing, and informed buyer or I remodel them myself.
I also didn't say to not disclose what I know. I will disclose everything I know in the state law required property disclosure. I certainly won't offer the information up during without them asking specific questions. That's just basic business.
It's no different than a tenant asking you if you'll take less on the price of a rental, when you could absolutely drop it $400 and make no cashflow. You tell them no, even though TRUTHFULLY, you could.
Dan, you have experience. Make the deal make money one way or another or pass. One question I like to ask myself on properties that are junk is this, "Who's going to buy it, if not me, and what are they going to do with it?"
If I can't figure out what to do with it, I try to put myself in someone else's shoes.
You have to be versatile. --74.47.xxx.xxx
Near Miss (by RB [MI]) Posted on: Aug 6, 2017 7:10 AM
Meanwhile, back at the sensitivity training class ......... --71.13.xx.xxx
Near Miss (by Susan [OH]) Posted on: Aug 6, 2017 7:36 AM
IF you don't care who buys it, NE, why did you backpedal on your 3rd post? As in when you said, "Ok, maybe don't sell it to a newbie for 10k"..
You were perfectly willing to sell it w/o disclosing anything-or have the original poster do so. Until disclosure was brought up.
And what does your buying a property, fixing it up, and reselling it for a higher price have to do with anything? Or the bank caring about what kind of experience you have?
I just don't get what you're saying.
Not meaning to pick a fight with you.
I just would NOT be comfortable with buying a piece of junk and trying to resell it to the biggest fool (ie newbie)for the highest price I could, as you originally suggested. I don't like to take "unfair" advantage of people.
When you suggested selling it to a 'newbie", that's what I saw. Taking unfair advantage of someone who didn't know better.
Sorry, that's how I see it.
Near Miss (by NE [PA]) Posted on: Aug 6, 2017 8:00 AM
I back peddled so the description of the buyer could be more palatable for you. Also that the benefit of buying and selling this property and not doing anything to it wouldn't be missed.
The disclosure was brought up by WMH almost the same exact time as I posted, I didn't mean or imply to not disclose. --174.201.xx.xxx
Near Miss (by cjo'h [CT]) Posted on: Aug 6, 2017 10:12 AM
Selling that property for that price to any idiot,there's no way they can't make money,doesn't matter what day it is?...................Charlie................disclosure or not........................... --174.199.xx.xx
Near Miss (by Deanna [TX]) Posted on: Aug 6, 2017 10:39 AM
"We settle at 10 K." "The contractor said walk away."
Is the house committed to, as in, contracts signed and money exchanged? Or is it still possible to go say, "Um, wait a minute."
We buy bargain-basement houses all day long, but one thing I earned early on was the difference between structural and cosmetic damage. I was dazzled by the thought of a 3/2 for $10k, and thought that structural things like sinking piers and bad walls could be solved as easily as we could fix cosmetic damages. But it wasn't the case.
"Kitchen sinks draining directly into the dirt basement" don't sound so difficult, but "main support beam is rotted" would definitely give me pause.
If you don't have anything else on your plate, and you want to salvage something that's only fit for the bulldozer if it goes another year or two like this--- go for it. In an ideal world, it will gross $18k a year, and will gross back its $80k renovation in under 5 years, its purchase price + renovation in under 6. But otherwise, let them keep their headache, and save your resources for something that's not so needy. --96.46.xxx.xx
Near Miss (by Blue [IL]) Posted on: Aug 6, 2017 11:00 AM
$80K rehab number was the "I don't wanna do it" number.
I had a termite eaten main beam of a 2 story house replaced for $4400.
I don't do these kind of deals, but that doesn't mean that you should take the first number thrown at you as gospel. --75.132.xxx.xx
Near Miss (by DJ [VA]) Posted on: Aug 6, 2017 2:53 PM
If it really rents for $1500, then $75K (2% rule) isn't that far away from the estimate. You might double-check the numbers & get another estimate. Perhaps be your own general contractor to keep costs down. And if it's a "C" neighborhood, make it safe and simple - nothing fancy. It might still be a worthwhile deal. Any chance of the neighborhood showing signs of improvement long-term? Just saying take a breath & think on it for a day.
If you haven't closed yet, you could just walk away and consider your earnest $ tuition in the school of life.
I also say to disclose anything you know if you decide to sell. --68.105.xxx.xxx
Near Miss (by RentsDue [MA]) Posted on: Aug 6, 2017 6:32 PM
I would demo the home and put a brand new one there. I realize that labor costs more in Boston, but a modular doesn't. --66.189.xx.xxx
Near Miss (by cjo'h [CT]) Posted on: Aug 6, 2017 7:28 PM
Omadhan,I don't think so.you stupid A..cjo'h. --174.199.xx.xx
Near Miss (by BRAD 20,000 [IN]) Posted on: Aug 6, 2017 11:38 PM
Handyman Special. AS IS. $_________.
One person's trash is another's treasure.
I recenlty bid on a half burned large house. I can handle such a project. Other investors bid higher. The next door neighbor bid double my price then paid more to tear ii down. He wanted a vacant lot and paod dearly for it, by his own choice.
A year later he is trying to sell his home but pumped up the price to cover the cost of the additional lot.
Near Miss (by Susan [OH]) Posted on: Aug 7, 2017 4:33 AM
All of you are missing my point.
There is a difference between someone outbidding you on a burned out house and deliberately selling to a "newbie". (The connotation being only a newbie would be so foolish as to buy whatever you are selling!)
I *thought* those of us who are in real estate should "stick together", not "stick it to" anybody we can!
Near Miss (by DanNBoston [MA]) Posted on: Aug 7, 2017 6:06 AM
Thanks for all the responses.
I passed on this one.
I have lots of experience with this sort of propery and would love to take on a late summer project, but I decided to pass for other reasons. Mainly because the house is out of my farm.
Thanks all and on to the next. --174.192.xx.xxx
Near Miss (by R [OH]) Posted on: Aug 7, 2017 9:50 AM
RB - Very funny.
I don't have anything and DanNBoston has made his decision but I thought that this was a very good discussion. I can definitely see Susan's point of view and that is my way of thinking. But I can also see some very good points by NE. I guess if I had the property I would disclose the good and the bad. Also as Richard has said he can get it done for less but he is a contractor. Agree with Blue that perhaps that was his "I don't want to do it number." This would definitely be a case of getting two, three or more estimates.
Good discussion and something I will ponder in the future.
Thanks all. --12.47.xx.xx
Near Miss (by Chris [CA]) Posted on: Aug 7, 2017 9:05 PM
"Buy expensive and cry only once" (Chinese saying)