OfflineHello Everybody,
This is my first post on the forums. I have been reading posts, Deans books and doing research on properties for about a month now and I think I'm ready. I heard about this property from my neighbor.
4 Bed 2 Bath Ranch
Built: 1972
Sq Ft: 2400
Lot: 11761 Sq Ft
Location: Eastern Long Island
Asking: 220k
Tax Assessment: 376k in 2008
Est Value: 310k
Last sold: 289k in 2002
Taxes: 7,872
My mind is having a hard time wrapping itself around how much equity I can build into this deal (and my assignment fee) Ive done just about all of my homework. Tomorrow morning I have a meeting with an agent from around here that is also a REI. Turns out, most of his family are agents and REI's. What Luck! So if all goes well tomorrow hopefully we can make an offer. I am hoping he can draw up a nice assignable purchase agreement with all the contingencies I want and make an offer. I'm thinking 180k (about 40% off FMV) with money back for repairs if any.(haven't seen the inside yet) And seller paying; closing costs and agent fees (the house is listed). Asking too much? I still don't know the sellers level of motivation yet. But based on the asking price it seems high. I guess we will find out tomorrow.
-Mark
What are the comparables? That's what you should be concern about! Don't depend on the tax assessment. Tax assessment has nothing to do with value of the property. Do a comparable market analysis of other similar properties and call on other agent listings to have an ideal of your competition.
"I will NOT BE BROKE! ANYMORE!"
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Mark; Atlcamel is correct I'm new at REI but i'm a realtor and tax assesments don't mean much, get your self some comps so you can get a better gage at what you are dealing with. Good luck let us know how you make out Edwin.
But, its rough around here. Not much has moved in the past six moths and what has sold is not exactly "comparable". I came up with my estimate from talking to an agent at an open house for the same model home. When I asked her how she came up with the asking price (339k) she said that was not her number. That was the homeowners and that the house was appraised for 320k. So I subtracted the additional amenities (about 200 extra square ft and additional bath) and made a guestamation of 295 - 310k. I also used the dollar per Sq Ft method and came up with similar numbers.
I just got home from a meeting with the killer agent. And boy is he going to be a great part of my team. Hes an agent and an investor who is more than willing to work with me on everything from comps to partnering with me on deals to bringing my deals to bigger buyers.
Long story short...
I was close with my estimate but just a wee bit high. About 290k is FMV on that house. This deal is dead because as I feared this home is a short sale. But, at least I have a great asset now and i know all the info on that style house in case another one comes up.
-Mark
Thanks for sharing your story with us and it goes to show you that sometimes in real estate one potential deal can provide a great lead or benefit in another area. Congratulations for taking action and researching this potential deal. Good luck with real estate investing. Believe and Achieve!
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Started working with a mortgage broker and he told me that for an investor to refinance immmediately, that the financiers (he knows) will do up to 85% of the sale price or the appraised value (whichever is lower). Unfortunately, since I am an investor, it will be the lower.
Is this broker just unaware of who can or will go for the appraised value for refinancing? I would like to get the cash for the amount I purchase plus the fix up costs/closing costs etc. This would give me a clean slate to buy another.
I am using a line of credit for cash deals.
Thanks,
Larry
LarryP
Hey buddy, you got your feet wet and some learning to boot. Just take what you learned and go on to the next deal. It sounds like you have got a couple people to partner up with. Now don't get cold and go find another deal...Jan
You are heading in the right direction. It is great to find a great agent like that. Let us know when you make an offer.
Jeremy
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Mark,
Good luck in your future deals and not to be a grinch, but realistically I think that deal was dead even before you found out it was a shorty;
if the house was appraised in the 330k's and the owners were not so financially destitute and had to move that day, I seriously doubt $180k was even half going to make it
Eastern Long Island and in the $330k's??? That sounds like it might be in the Uniondale/Hempstead/Elmont area if I am correct
Keep plugging away