OfflineIf you are making offers on a regular basis on short sales, you might see this on a regular basis.....submit offer and then wait and wait and wait. What if the offer is accepted 3 or more months later? Is it still a good offer for me? In some cases, it might be, but you need to do more due dilligence and have some clauses built into the contract that leave you a door to exiti if needed.
In some area your original offer might be fair market value now. It will not work for you if you are wholesalign the property. If this occurs, I wold recommend revisiting the fair market value for the home in the CURRENT market and see if the numbers still work for you now. Even if you submit and offer at 70% of FMV and it is accepted 3 or more months later, the market could have dropped that much or even more. Get an agent to pull sales comps in the surrounding area for homes similar to the prospect property and then figure out the cost per square foot right now.
Just make sure the numbers still work right now!!! You might need to counter offer on the accepted offer and see what happens then.
It is never worth your time to try to make numbers work on a deal that just doesn't make sense, even if it is your first deal. There are plenty of deals out there keep hunting.
If you would like the chance to work with me or one of my fellow real estate investor coaches and our advanced training programs, give us a call anytime to see if Dean's Real Estate Success Academy and our customized curriculum is a fit for you. Call us at 1-877-219-1474 ext. 125
It's hard to imagine that a short sale would sit for so long. Do you think the market would drop that much more?? I don't know, it is a crazy and yet sometimes risky business. Just my thoughts.....Jan
A colleague of mine just had his offer accepted that he made 6 months ago. The original offer amount is about 20,000 or 30,000 off now. The property has lost value and he needs to obviously retain a profit margin, so he is considering countering or walking away based on the clauses he has in his original offer.
Some areas are still dropping depending on how many foreclosures/short sales are occuring in that area. In this particular area, there have been a lot of short sales/foreclosures occuring, which has resulted in the lower FMV.
I just thought I would share a personal experience to make people aware. It is exciting to get an offer accepted, but the market is not always the same as waht it was months ago. Always double check the numbers.
If you would like the chance to work with me or one of my fellow real estate investor coaches and our advanced training programs, give us a call anytime to see if Dean's Real Estate Success Academy and our customized curriculum is a fit for you. Call us at 1-877-219-1474 ext. 125
My property manager just provided me with 5 short sales today and all these homes are rented with tenants. I will be signing the contract on all 5 tommorrow. All my offers will be below $20K. My property manager, who's also a Broker said he has seen it take as little as 2 weeks, 1 month, 2 months and 3 months. It all depends.
Here is one of the homes:
5 bedroom, 2 bath
Rented at $600 month
Short sale offer is $15K
Will wholesale for $25K
"If you cannot do great things, do small things in a great way.”
Napoleon Hill quote