OfflineSo here is the dillema. I have been searching for buyers, and I already have a small buyers list going. However, they all are looking for the same type of property. Yesterday, while starting to look for property in their price range, I came across an absolutely AMAZING deal. Thing is, no buyers for this deal, as it is currently out of MOST people's price range. It came up as 800k, 6/5 with close to 6000 sq ft. All the surrounding houses are valued at 850k, but 1/3 the living area, approx 2000 sq ft. The comps in the area go for 1.4mil, and are short about 1000 sq ft in living space. Also, I know this is a motivated seller, as it has been on the market for almost a year and a half, and has dropped in price 4 times. Where would a person find a buyer that would be looking for a house in this price range? Should I keep pressing, and not worry about this deal, or go into overdrive trying to find a buyer who is looking for something like this, then lock it up and assign it.
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The house is overpriced for the current market or it would have sold already!
If it is totally move in ready and needs absolutely no work I would offer around $550,000 max.
Also, if there are no buyers this is NO deal! I would try to locate a buyer (run a ghost ad for a $600,000 house worth $750,000) meanwhile keep looking for DISTRESSED entry level SFHs! That is where you will make consistent deals.
Good Luck!
Michael Mangham
MD Home Acquisitions LLC
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I was looking for distressed properties, but I kind of found this one by accident. Before you posted I had already come up with a way to go about dealing with this property.
1. Keep my scope lower in property value and find the homes I ALREADY have buyers for.
2. Since I found this home by accident, I will still spend some time with my neighbor (real estate agent) and ask him some questions regarding this property since there is the potential for lot of money to be made. (i.e. running title searches, checking comps through my agent). If its such a good deal from what I can see, then there MUST be something inherently wrong with the property (or neighborhood). I live 45 minutes away, but I did not mean to find the property.
3. Stay focused on my attainable goals, and build raport with the buyers I already have.
4. Don't get in over my head on my first deal. If I can get a deal to happen, then it was meant to be, otherwise... maybe staying small at first just to get my feet wet.
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So being new, I have made a mistake and have immediately learned from it. After doing more research, this "AMAZING deal" that looked AMAZING on the outside, did not look so amazing on the inside. As I said earlier, I "found" it on accident, and it was listed at 775k and approx. $125/sqft. The estimate that I saw, was listed at 1.5mil. Instead of searching around the area for recent homes that sold in the area over a time period, it just gave me the most recent homes sold, and of course, it gave me homes sold from middle of 2009, and one from 2008. So with digging a little further, the homes that have sold in the area, with relatively close living area (5000 - 5500), have sold for about $85/sq ft. I now know to do my homework before jumping out of my pants at a deal that seems too good to be true.
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Great advice Michael
Jim Kendrick
http://kendrickpropertymanagement.com/
http://rochesterapartmentrentals.com/?page_id=10