BUYERS MUST "PAY ATTENTION" TO THIS

How are you advertising these properties? I noticed on the first one you have the buy price at 70% not including repairs. You really need to include the repairs in that 70% buy price to where the investor can pick that property up at 175k but the second one looks like you have done that. I would advertise these everywhere I could like backpage and craigslist as well as anywhere else you can think of. Advertising and your buyers list is key. I have found that it is much easier to find buyers if you actually have the property instead of just putting up ghost ads. You are on the right track though. I would also maybe try advertising these as buy and holds instead of rehabs to see if you get any bites. I am going to send you a PM as well so please watch for it...

The Prosperous ...

I have had a similar situation. In my posts I referred to these type buyers as window shoppers.

Also same thing on the spread or profits made. 45k to 50k is not enough.

My advice would be to keep fine tuning your marketing. In your ads , let people know what the profit margins are and those that respond will be ok with that. Just an idea.

Best of luck to you in 2011 !!

Randy S.
Elkton MD

This is how you know who the players are. So when you find guys or gals that want to buy. You know you have a solid buyer. Don't get discouraged. Keep marketing. The picky buyers that bigger profits will lose out and make no money while they wait for one big profit deal. Greed glands on these cloud their minds or they are just not real buyers.

Are these houses you find on the MLS??? Perhaps most have already seen them and if they can't find anyone to flip them, whats the point of buying???

Usually when I have a deal that does not attract buyers its because my ARV is too high and my re hab costs are too low. My buyers know what the properties will actually sell quickly for. If currently listed comps are priced the same as yours and selling quickly than that's a different story, but I bet there are houses like yours priced lower with some pretty long DOM.
If you have a property that is 70% of a true quick sell ARV (not top estimated sale price) after repairs it will sell unless no one is buying in that area.
Most real buyers will do a deal that will NET them 15% or better. Spreads of $30,000 to $40,000? What if its a $100,000 property? ROI is what real investors look at, not X amount of "spread". If your deals will allow the investor a true ROI of 15% or better they should move quickly.
Always run your numbers based on the low side of ARV (quick sale price) and have room for savings built into your rehab estimates. Supply written estimates from your contractor and make him available to do the work for your buyer if they wish.

Michael Mangham
MD Home Acquisitions LLC

I agree with Mr. Mangham-

ALL my buyers want at LEAST 15% ROI and nothing less.

It's also important to watch 'changing areas' and areas of growth.

Run the numbers-if they work- you got a deal.

Randy,

Thanks alot for your feedback.

Take a look at the attachments and let me know what you think of our due diligence reports.

Best of luck to you in 2011 as well.

Ryan
www.arrowcapitalgroup.com

Advertising the properties via:

Craigslist
Contacts
Social Networks

My mentor is very old school and does not seem to believe in more creative marketing methods like printing up our due diligence reports; going to real estate investor mixers and giving one to everyboby.

I'm going to just start myself. I cant begin to tell you how frustrating it is to have real deals but only have time wasters calling and email about them.

We could include the repairs and I did suggest that but my mentor has not acted on that yet.

How is backpage? I've never used it.

I appreciate all your feedback Matt.

Ryan,
www.arrowcapitalgroup.com

You hit the nail on the head.

This is the part that most mentors don't tell you about from my experience.

All you here is learn to lock up deals legally, market for buyers, then match the too and get paid at escrow. They make it sound so easy but that is far from the truth.

It's one of the worst parts of the business to me. Dealing with these jokers when I know we can get at least 3-7 deals under contract a month but we must hold off on ramping up our operation until we have buyers who can take those deals off our hands.

There is so.... much more to the assignment game than what is advertised in courses and all that stuff.

Thanks for your comment King.

Ryan,
www.arrowcapitalgroup.com

Have ex-father-n-law buys properties.

Tazz2122

my name Robert get in contact with me lets work together..the bible says where two more are gathered together..........

I have taken a look at the properties and really like your layout for them. It would recheck the numbers though; the ARV on the first one I'd put around $245K completely fixed. Below are the quick comps I would use when initially evaluating a deal (If it looks like good spread, I'd actually look at pictures and drive to the area when it looks to be a good deal:) Then, I take the numbers, stick them in a spreadsheet, calculate them based on price / sq ft, remove the highest and lowest per square foot, and come up with my ARV, subtract the rehab costs from that, subtract my HML fees, closing costs, transfer taxes, monthly mortgage expense, property taxes, insurance, utilities, for however many months I think I will need to hold it, and RE commissions of 6%. If after subtracting all these fees it doesn't work, I won't pursue the deal.

In this case, based on comps below (and I went back 6 months i/o only 3 months), if I wanted a $10K profit after all my expenses and work into the rehab, unfortunately, I couldn't buy this property for $190K. I would pay $181K for it if I wanted to make $10K profit on it by fixing it and flipping it. If I can sell it for more than the ARV based on the $/sq ft, that is extra to me, but realistically, I wouldn't count on $270K as the price I can sell it for fast. I'd consider I'd get $245K, the appraisal would come in around that number (+/- 10K) and my HML would lend based on that number, not $270K.

I MAY want to consider it as a rental property at this price (if the rental comps make sense), doing a cheaper rehab and keeping it for that reason; BUT, as a fix and flip, it isn't feasible unless a buyer doesn't need a HML. A HML takes a pretty good chunk of fees remember. And, at that, I'd need to consider the refi costs and make sure I can pull out some money to make sure I have money in the bank for the next deal (because HML escrow the repair fees, so you need to have money to put into the escrow for the fees, ESPECIALLY here in CA). Hope this helps you see how a HML investor in your area views the deal. Sorry it isn't the best answer, but its straight forward. HOWEVER, there are investors out there that may take the risk on it selling for $270K, I see it all the time here in SoCal, so just because this is MY take on it, doesn't mean there isn't an investor out there that would jump on the deal, ESPECIALLY if they don't need a HML. (If I didn't need a HML, I'd jump on it! )

464 East ADAIR St $236,000, Sold on Dec 16, 2010 0.04 miles
2 bd / 1 ba & 1,044 Sq. Ft.
477 East ADAIR St $230,000, Sold on Aug 16, 2010 0.04 miles
3 bd / 2 ba 1,200 Sq. Ft.
6041 LINDEN Ave, $195,000 Sold on Dec 03, 2010 0.07 miles
3 bd / 1 ba 1,042 Sq. Ft.
175 East ADAIR St, $178,000 Sold on Nov 03, 2010 0.17 miles
2 bd / 1 ba 1,192 Sq. Ft.
322 East OSGOOD St, $257,400 Sold on Jan 25, 2011 0.18 miles
2 bd / 1 ba 756 Sq. Ft.
353 East 61ST St $290,000, Sold on Nov 03, 2010 0.19 miles
3 bd / 1 ba 1,000 Sq. Ft.
6087 LIME Ave $197,000 Sold on Dec 23, 2010 0.19 miles
5 bd / 2 ba 1,275 Sq. Ft.
353 East SMITH St, $299,000 Sold on Oct 18, 2010 0.2 miles
3 bd / 1 ba 1,003 Sq. Ft.
301 East 59TH St, $180,000 Sold on Nov 05, 2010 0.21 miles
2 bd / 1 ba 840 Sq. Ft.
6028 LIME Ave, $192,000 Sold on Aug 31, 2010 0.22 miles
3 bd / 1 ba 1,078 Sq. Ft.

Tammy is one of the best at determining a quick ARV! I would listen when she speaks! Wow Tammy you really broke that one down, thanks!

Everytime I locked up a property, I put in on CRaigslist and sold it within weeks. I also put some bandits out there but not often. Less then that, I had to put it in the paper. If you have a GOOD DEAL, IT WILL SELL. The very few times I couldnt sell is because it was not that good of a deal.

I also don't care about ARVs , rehab numbers, or giving them too many details. Do you think with a home buyer with lots of cash and buying his first home knows what ARV is? Also people have different opinions on what that # is and you maybe shooting yourself if someone thinks the house is worth more but you are saing a conservative ARV. I learned that less is better in this business as a salesman. Do you like when you go buy a car and the sales guy just rambles on and on about how great the car is. I rather ask the questions if I'm the buyer and that's the only time you have to be detail.

This is how it works for me but you do your own thing.