Jump to content
The forums have been archived and are now read only. Years of great info saved for your reading pleasure. Thank you! Visit us on Facebook: https://www.facebook.com/NakedInvestor/ ×
The Naked Investor Forums
wildwestinvest!

Race to get a deal done.

Recommended Posts

Alright, back to being serious.

 

The job isn't done when you sign up the deal! Ok, that may be the hardest part, but what a disservice I am doing by acting like the marketing job is done!

 

I got 2 deals on my hands, I picked up that probate property due to my persistence in tracking down the owner, and being there at the right time when he was ready to sign a contract for bottom dollar. Sweet. The other one is a pure option that is about 50k under value. This was homeowner interested in lease-purchase but ultimately would rather take a pay cut than have to deal with all that. Cool.

 

I've got signs up, I've got directionals up. I've got classified ads. I've emailed my old list of contacts. CL ads are up. Postlets are up. I'm networking to spread the word.

 

Both of these are great properties at smokin' prices, but as per MC's ultimate wisdom.... I need enough marketing!!!

 

Stay tuned. I have a few interested parties in both, but I need that money-maker to step up.

Share this post


Link to post
Share on other sites

Good work, Nick! Congrats on those two new deals. Get the word out. If the deals are as smokin' as you say, your money-maker will appear.

Share this post


Link to post
Share on other sites

I really think they are. Got one 4br undervalued by about 50k, verified by comps and assessor's office, plus it's a genuinely excellent location (2 blocks from the bar!). Then I've got this 2br rental property which, I just discovered yesterday, is a limestone building! It's built with giant cinder-block sized pieces of limestone. Hidden value!

 

So I've been taking piles of calls on both and showing them a fair bit. I'm got some serious biters on both and here's what I'm looking at.

 

On the 4br, I've got a pile of people with conventional financing, just lining up. Scares me a bit. One of my original lessons was to not use brokers and banks because they will take all of your control away. On the other hand, if I can get one of these parties to close, I can accept my asking price which will net me $17k in the deal!). Am I setting myself up for failure or is this part of the game? I'm thinking of doing one of the old, buyer and seller enter into a contract, and I quitclaim my option at closing for $17k. I've got about 52 days left on my contract.

 

Then there's the 2br. This is your classic fix n flip project except the margins are tight. The good news is it's a valuable piece of property, with a big garage, and it's a limestone building, so there's some real value in it. Mix in the newer hotwater heater, furnace, roof, and windows and you're looking at something worth putting on CL. All you need to do is add a fridge, a new carpet, and slap a 'For Rent' sign on the front. I've had a number of lookers and interest is building among the serious parties. I'm asking 49k which would net me 6k on the deal and I don't think I should give in on that price. I have another 110 days left on this contract.

 

If I close both of these at full price (which I fully-intend) I'll make last year's gross in about 2 months this year! And in the coldest part of the housing season! Not an easy task! I will continue forward with full effort!

 

Now I've got some geezer blowing up my phone trying to get me to flip his $750k property for $600k. What am I? A f%$#ing realtor?

Share this post


Link to post
Share on other sites

 

On the 4br, I've got a pile of people with conventional financing, just lining up. Scares me a bit. One of my original lessons was to not use brokers and banks because they will take all of your control away. On the other hand, if I can get one of these parties to close, I can accept my asking price which will net me $17k in the deal!). Am I setting myself up for failure or is this part of the game? I'm thinking of doing one of the old, buyer and seller enter into a contract, and I quitclaim my option at closing for $17k. I've got about 52 days left on my contract.

It's part of the game, Nick. Deals don't always go down according to plan. That's why we always need a Plan B.

 

 

Now I've got some geezer blowing up my phone trying to get me to flip his $750k property for $600k. What am I? A f%$#ing realtor?

Nah. You're too smart. :P

Share this post


Link to post
Share on other sites

Long time no update..... things have been busy.

 

The pure option on the 4BR turned out......almost. Well the good news is I almost know how to line up a deal worth 17k, the bad news is I somehow had my head stuck in the idea that I HAD to sign an option for 30 days. *******! I found a buyer and everything and they basically went right around me because I couldn't get the deal done in just 30. Should have signed that contract for 60 plus 60 day extension and I would be 17k richer right now. *sigh*

 

The other deal ended up with a pile more repairs than originally identified. HOWEVER, I did renegotiate this one with the homeowner to take 3k off the top. I have received offers at 41k, I'm going to try to milk someone for 43k so I get something worthwhile out of this deal. It's still a good price but things are SLEEPY in Feb/March around here.

 

In the meantime, I have been rather consistent and committed with my marketing. Big ups to FB marketing. I'm currently on a streak of 10 leads in 10 days, one of them turning into a pure option at about 66% of ARV. I think the figure look something like option at 80k, need 10k repairs, ARV 120k. I'm going to talk to an appraiser friend tomorrow whose also an investor to see if I really got anything on this one.

 

But like I said, leads are piling up. Tomorrow I will go see 2 houses owned by a motivated seller in a small town. It already sounds like I can get this very cheap, the issue is that I do not know what they are worth. Such a tiny town that there is nothing but completely worthless sales data. So.... what I did before in a situation like this, is I went off of rent figures, trying to keep the gross rent multiplier below 115 (sales price / gross monthly rent) so I attract investors.

 

Then I have another decent sounding lead on a 4BR motivated seller in a nearby town. Again, sounds like a unglorified Realtor flip.

 

Anyway, let's wrap this thread up with some quality lessons learned.

 

1. Flexibility and creativity are why we excel as investors. You don't NEED to sign a contract for 30 days. At the last moment, when they tell you they want 227 instead of 225, then you say, alright, well I want 2 more weeks then. You can sign it for as many as you can get the other person to sign it for. Don't sell yourself short.

2. Marketing does provide results fast when it's done right. However, marketing is more about commitment than anything. The results I am getting from being back in the game for 2 months is profound. People will look at your ad 20 times before they build up the confidence to call.

3. There's advertising, then there's marketing. Learning the difference will take a lot of practice and a lot of reading. Once you learn to market, your game goes viral.

4. Stay creative. Like MC said, make sure there's a plan B in place. Oh ya, that was lesson one.

 

Anyway, I still have a goal of $60k profit by July. I plan to stay intensely busy. An absolutely beautiful girl is coming to visit in July and I'm taking the whole month off (not my marketing, just me). I love this $#!^.

 

Booyah!

  • Like 1

Share this post


Link to post
Share on other sites

Excellent post, Nick. Thanks for sharing it all. Lots of good insights and lessons learned. I always say, "The best education is first hand experience".

Share this post


Link to post
Share on other sites

Annnnnnnd.... it paid. Collected a $500 nonrefundable deposit toward the $8000 assignment fee of an option I own. Hoping to see the rest in 45 days at closing, possibly as many as 60. My contract with the homeowner is still good for 90. It took me 7 days to find a buyer, it was a friend whom Ive done some rock climbing with who is an appraiser. I got it to him without setting up the marketing for it.

 

I made a colorful 7 page handout for the property. I included about 30 pictures and did a pro-forma at goodmortgage.com (look for their investment one) and had a description page. And a page with my name and number. People want the bow. Gold watch? meh. Gold watch in a pretty box with a bow??? yeeaaaa!

 

If the numbers are real, investment grade gets bought up quickly.... hopefully we see it close! itll be their 4th townhouse if it does!

  • Like 1

Share this post


Link to post
Share on other sites

So far, so good, Nick. Stay on top of things and nudge everyone along as needed. $8K will buy a lot of rock climbing equipment. . .and bandages! :P

Share this post


Link to post
Share on other sites

Thought I should stop in a confirm things. Cha-ching on the quick flip. $7400 in hand (how i lost $600 is another story)

 

The 2br house ended up needing a renegotiation but I still profitted $2k off it. I actually picked up another smoking deal and the home-owner ended up paying me out to cancel my contract: some $500. That deal was bank, but I had little choice.... she played my soft heart and I wasn't going to get much done without her compliance.

 

$240,000 house with $50k in repairs for $66k.

 

The deals are out there. Profits to be made. Get 'em.

  • Like 1

Share this post


Link to post
Share on other sites

×
×
  • Create New...