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MC: thanks for that newsletter! Good reading, and perfectly in-line with every other (non-realtor) market assessment that I've seen. Interesting to me that Atlanta was #10 on the top foreclosures list ...yet I'm still dealing with sellers that think they're being perfectly reasonably trying to mark up the house they bought 14 months ago by 10% above their purchase price!! Clearly Atlanta is still early in the downturn, and still early on the "oh crap" seller acceptance-of-reality curve that MC described. It's been tough (gotten NO deals under my belt since I started in early Jan 2007), but I'm looking at the present doldrums as time to hone my technique (sooo many calls...), tweak our website, and press on -- knowing that we'll really be ready when the downturn starts to sink in.

Good to see you back, CS!! I won't mince words: reading your posts (and especially your multi-page thread chronicling your beginnings -- wherein you posted images of those first checks!) was a large part of my early inspiration to pursue REI. And while I've hit a bit of a stall in my own startup efforts, seeing you still pressing on (and having success) is one more motivator for me to press on too (as if I needed anymore motivation at this point -- being stuck on the day-job treadmill and being barely able to spend any time with my now-6-month-old daughter is waaaay more than enough motivation!) Please keep sharing your stories! Blue skies!

Well, I can report good news here -- I didn't bring up option money, he did. And I never mentioned an amount (and neither did he). And I told him that if an option fee were going to be part of any deal, it would have to be deferred until if/when I collected an option fee from the t/b. This is the only conversation that I've had yet where an option fee was even discussed. So that's good As for the "option fee" listed in the offer that I posted earlier -- I listed that as a "highest I'll pay if/when he brings it up". I have no intentions of tossing that out there until he brings it up again, and even then I'll let him name what amount he is thinking of before I chime in with a number. I hear you. My perspective at this stage is that even if I can't get a t/b to close until the last year, then that's still a worst case of only a few thousand at close ("worst case" in that it assumes that I don't raise the buy price for the t/b contract for that last year -- and we all know that when you re-negotiate with a new t/b after the prior one falls through, you go for a higher buy price with the new t/:unsure:. Furthermore, I don't think the seller is going to be real responsive for anything that doesn't protect his final price; he's willing to be very flexible on terms and monthly rent, so long as his bottom line $ is covered. Lastly, even though the guy is moving, he will still be in the state and I'd like to work with him in such a way that says "good person to deal with" in case any opportunities arise in the future. I'll certainly see what he's amenable to -- I'll start out asking how he feels about a fixed price over the term and see where that leads. If it leads where I suspect (he'll want the strike price that covers his potential out-of-pocket for the full term of the lease, regardless of when I cash him out) then I'm back to an escalating scale being the best workable alternative for both of us. Roger that: I'll ping him on a CA, but my gut is that he won't be interested. He's already stated pretty explicitly that he "just can't deal with the property anymore", so I'm betting the CA route won't sound too appealing to him. Then again, I'll never know unless I ask.

OK, not only am I exceptionally dense and a slow learner, but I'm also quite possibly a masochist. I talked to seller #3 yet again -- but only because he called me, as he is seriously chomping-at-the-bit eager to make something work. The starting figures: $335,000 asking, $2250/mo. He's willing to eat a monthly difference and roll it into the final purchase price on a lease option. He came up with 1500/mo as a monthly number that he could handle (I promise, Coach, I'm getting better about obeying the "he who talks most..." rule). The bottom line is that this house comps at $365000+ right now, yet he's willing to just get out from under it at his original cost. So... this is what I'm thinking of offering to him: - 36-month lease - $1500/mo - $344,000 if bought within first 12 months - $353,000 if bought between 13-24 months - $360,000 if bought between 15-36 months - $7500 option fee, payable upon placement of T/B For T/Bs, I'm looking at: - 12-month lease - $1700/mo (w/25% rent credit for on-time pymts) - $9000 option fee - $380,000 base purchase price, $365,000 possible (base price minus option fee and all possible rent credits) So... MC (and any others): am I just reaching too hard? Or could I be onto something? Should I just quit pounding my head against this one and look for more "textbook" pastures?

I hear you -- I just want to be sure that I don't miss any opportunities that are within reach of a strategy that's jussst a bit outside of the "textbook" ones. But what I really need to keep in mind at this point is that slow and steady wins the race. And "slow" is definitely the best way to describe my learning Wow... well, I'm a far cry from an authority, but I think it's safe to say that the much-ballyhooed real estate "cooling" trend hasn't cooled Atlanta too terribly much ...yet. It's clear that it's now a buyer's market here, and seller's are well aware of that, but it hasn't noticeably depressed prices all that much yet. I'm seeing the long-listing phenomenon creep ever further down into the median price ranges -- e.g., the high 200s. I suspect that after another 6-12 months we'll start to see some real price differences. Then again, what do I really know? I just started learning this stuff -- I mean, up till now, I've been writing software. Talk about being insulated from pretty much anything real

No worries, MC -- you're confirming what I have already suspected. A few quasi-twists; they don't really change anything, but just for anyone who's following along: 1) This seller has indicated that they would still be interested in a deal even if it pays them *below* their current payments -- which I pretty much told them straight up is about the only way I'd be able to do anything for them. I suppose their logic is that it'd be better to offset some of the pain while working towards a sale. I'm still writing this one off -- just not enough there to work with, and my Drama Detector is twitching at the idea of whatever deal would be required to make it work for me. 3) The ask price of 335k is at county appraised value but below the one available comp by about 25k. The only way I figured a PO could be made to work would be by working that angle -- PO at 330k, option fee of 5k, make the pitch that FMV is 365-ish. I figure the worst that could happen (assuming I could even convince the seller -- a RE agent, remember -- to do such a thing) would be to PO on some really short term (30 days?) and see if I could move it. And while I'm wishing: for Christmas this year, I want a pony But fear not, fair reader! I am in no danger of becoming a motivated buyer ...I just need to figure out how to work the Atlanta market. Hell, how to work *any* market And I continue to be impressed with this community. Thanks again to you all and esp. to MC!

Already, updates on my previous post: 4) is not interested -- said she's having her property staged. I wished her luck, told her to call me back if it doesn't work out (she has flyer's we faxed to her last week) and she gets tired of more monthly payments. Clearly not motivated ...yet. If she doesn't call back, still one of several good learning experiences. 2) Talked to this seller again -- initially said she didn't want to go that route since she was moving back to Florida and wouldn't be around to "look after the property". I refreshed her memory as to what service we would provide ("WE manage the house and pay you your monthlies"), after which she said she'd consider it more and to call her back "in a few days". Not promising at all, and this is the house with zero equity, an awful loan and atrocious monthly payments. If she's interested, I dunno that I could work anything out anyway... 1) still verry motivated -- called me back to state that she and her husband were interested in moving forward. So... what now?! Make an offer, right? I can't find comps!!! Zillow doesn't have squat because it's too new of a development, and my agent contact doesn't have access to that county from her office. I'll be digging more later to see what I can uncover to give me SOME sort of ballpark (county tax assessor's site with past tax bills seems like best bet right now...), but any thoughts from any of you Big Dogs as to what you'd do would be appreciated. 3) No change yet -- still stuck on trying to figure out what I can even do here, if anything...

Going to try to keep these short and sweet -- I know everyone's busy. Thanks in advance for any feedback! 1) $194000 asking, $189000 on loan & $1558/mo -- owner relocated so very motivated. 2006 construction, 3/2, full bsmt w/framing and plumbing for bathroom. $1500 would be a high rent in the area, even if a sale price of, say, $191000 was reasonable based on comps (and I don't have comps yet). Since they're out of state I doubt they'd be interested in a CA. They also still don't have a house in their new location, so they have some concern about getting financing for a second house -- wasn't sure how most lenders would approach this so I didn't have anything good ready to answer with. 2) $192300 asking, paid $184500 in Jul 2006, $1589/mo -- older woman planning on moving into house with her son but Jr. cancelled last minute. Can't handle the payments, moving back in with kids (out of state), needs to sell. Is currently subletting out a bsmt apartment to a college student month-to-month. 4/3, 2 car garage, full finished bsmt w/BA and private access. $1600/mo is pretty much the top of the rent range for this area; comps at $188000. Again, CA might at first seem good ...but she's moving and certainly neither she nor Jr. wants to deal with tenants. 3) RE agent offering brand new 2006 4/2.5 for $335,000 -- he purchased for $335000 and needs to sell due to relocation. Current county total appr value: $334000. 2200/mo. Price and rent is very high for zip code overall, but not for new construction. I don't think a LO anything will work; best I was thinking was a 30-day PO if I can get him down to $330000 then shoot for assignment for 3-5k fee? 4) $152000 asking, vacant now, owner been making 2 house payments for 7 mo -- comps around $135k-$140k. Seems like a bread-n-butter SLO opportunity (seller paid 79k in 1992), with low sell price potential and good turnaround spread.

Thanks for all the feedback -- all very good to hear (or hear again, as the case may be -- can't hear it enough when you're getting started). Things are already looking better today ...and the day's just half over! For the record, I have never told Joe he's "normal". For the record: if NI is where the "normal" people hang out, then I'm definitely in the wrong place

OK, after my first week in the SLO bidness, I have some questions/thoughts to throw out there... 1) Most of the FSBOs that I've been pursuing are waaay pricier than most of the properties I see you Big Dog's talking about. And I mean in the $145k range ..with most closer to $175k-$215k. Regional differences aside, I've told myself this is still OK, since while the possible SLO rents on such a house would need to be higher ($1200-$1600), that's fine since (1) its still close enough to market rent plus rent credit and (2) any desirable T/Bs should be able to handle that. Thoughts/feedback/observations? 2) I've got a real estate agent to get me comps on sellers that pass the "I could consider a lease option" test -- I'm using the $/sqft approach, sorted by most recent, to get me a good number on the current FMV. But, having gotten there, I'm a bit hesitant on how to come up with a good SLO offer price. Any tips? 3) Having a phone/fax service already in place would have made things go soooo much smoother -- a good idea even if you're just getting started, especially with services like onebox.com that are month-to-month and relatively cheap (<$20). I wouldn't recommend jumping in without something like that in place, thinking that you'll get it if/when you need it (which was my thinking...) 4) Related to #3: develop a SYSTEM. Already I'm running into little considerations that, once things start to really take off, will eat time like my dogs eat ...well, everything. I'm also trying to constantly ask myself, "Will this scale well into a larger operation or into something that I can hire out?" I'm sure the Big Dog Pros on this forum can comment much more knowledgeably on this topic; my main point is just to state that I've already seen what a difference a system can make, and I've only been making calls for a week -- and have as yet to do anything more than that! Intangibles: I'm a bit frustrated . Yeah, I probably had unreasonably high expectations (OK, I know I did), but none of the sellers that I talked to have panned out (so far). Then again, I left the ball in their court in every case -- a big no-no when dating, and probably a big no-no in this biz, too. But ...learning is the name of the game. Tomorrow is a new day and a new work week, and I have 20+ listings to call on, plus new Craig's List postings, better "infrastructure" in place, and a deep-seated burning desire to be free of The Treadmill. Blue skies!

Just lurking and learning -- but figured I'd quote/highlight this gem of an axiom: Duly noted

Funny -- I just ran into this need myself. Signed up today as a matter of fact: http://onebox.com/ -- I went with their middle-tier plan, The Executive, as I wanted a voicemail service as well. That, and the name made me feel special The web interface is a bit clunky, but usable. The most important features for me: 1) relatively cheap @ $17/mo -- for 100 minutes of usage; we'll see how sufficient that is.. 2) no contract/cancel anytime -- important in lieu of point #1 3) simple (and simple to setup) forwarding capabilities -- voice mails and rcvd faxes get forwarded on to my "real" email account (onebox includes a webmail service, but why I would use anything other than my beloved gmail is beyond comprehension) 4) Two phone numbers, a local number and a tollfree number -- which come with some uber cool call forwarding capabilities ...all administerable over the web I'm sure there are more robust/capable services out there, but the price on this one was right, it was easy to get rolling (total time invested today: 1 hour, including time playing with faxing and forwarding messages and tweaking the voicemail greetings) and it meets my immediate needs. There are a total of three packages (the Executive is the middle), offering more/less capability at a higher/lower per month cost.

Just wanted to chime in here and add my applause for you "getting in" at such an early age -- if you're mental wiring guiding you in the entrepreneurial direction, then you're destined for great things I'm nearly 30, complete with house/wife/kid, and am just now fully realizing how much of my responsibility-free single life I wasted -- I could have been taking steps towards getting an awesome financial jumpstart (and been laying the groundwork to put my then-future family in a much better financial position from the get-go) instead of being the hedonistic bum that I was! So: a big /cheer for you and your ahead-of-your-years vision, and don't get discouraged -- no matter what!

The attorney bit wasn't so much looking for the go-ahead on a LO, but rather whether or not there was any way for the house to be handled other than an immediate straight sale. I've certainly internalized the common knowledge on these forums that the "lemme ask my attorney" route is usually the end of the deal After digging on the numbers a bit more, unless she can come down on the asking price by 7%-10% I don't think it would be a good deal anyway...

She has siblings, so there are other people with say in what gets done. I presume since she is acting as executor that she has more say, but I don't get the sense that she would do anything other than an outright sale without clearing it with them first. She seems open to something other than a traditional sale... it remains to be seen how open, though. The way the conversation was left: she would consult an attorney that she is referencing for guidance just to see if anything other than an outright sale was possible, and I would do my own homework to see what other possible strategies other than an SLO were workable.