4 Homes, Avg $64k Bmv! Now What?
I just had a guy offer me 4 brand new homes, all in the mid $200k range for an average of about $64k below market value per house. I want to make some quick cash, and offer them to investors for $30k below market value, and pocket the difference. What are the very first steps i need to take to complete this transaction. I cant buy them outright here in texas cause i would have to sit on them for a year. I want to control them, and bring an investor to the deal immediately, but I can't call any of my investors for advice because they'll be the ones im selling to. I don't know what contracts i need, and I only have a few days. This would be my first closed deal and I don't want to mess it up. Please help me!!!!!!
You need to provide more info to get a better answer, questions that come to mind are:
1. Do any of the homes need rehab ??
2. How much do you intend to make from each house ??
3. Why is he/she selling at an avg of 64k below mkt value ??
If you want to make 3-5k on each, then assigning would be the way to go. If you are looking to make 10k and upwards
you may have to do a double closing.
Why not partner with another investor(s) and rehab and flip, after all that's a lot of money to leave on the table for good properties. Something to think about.
[addsig]
the homes are all brand new, so they don't need any repairs. They're going so low because they want to close out the community. Yes, there is a lot of money to be made if I tried to maximize the profit, but I'm thinking if I can get about $30k for each house thats still $120k total! Thats fine for me, especially it being my first deal and all. I can quit working, and spend a lot more time studying RE investing!
localinvestor,
Sounds like these houses are being sold by the builder. Have you confirmed that the same houses on the resale market would sell for the amount that you have described? In other words are you just taking this guy's word, or have you already done your due diligence?
The reason I am asking is, builder has a lot of resources and knowhow as far as selling their houses, why would they discount so much?
What concerns me is this statement:
Quote:
I cant buy them outright here in texas cause i would have to sit on them for a year
Please explain what you mean by this...
If an investor had to hold a $200k property for 1 year, that could be as much as $20,000 holding costs! An investor certainly wouldn't be interested in buying the property for 85% of market, he would want it closer to 65-70%.
You may have some room for a small assignment fee and walk away with ten grand.
Please explain your statement.