Locating The GOOD Ones
I have just completed my second rehab. I made 10k off of my first and hope to make 20k off of the second, however, I am fining it extremely difficult to find houses that I can buy cheap enough to make at least 10k on. What do you guys recommend as the #1 best way to locate the "DEALS"? I'm beginning to think that I just got lucky so far.
the fishman
hi fish...since you are doing rehabs, have you tried the hud site & searching in the cities around you. with some scrutiny & using your mls site in conjunction with the above you may find some gems that are being ignored. I use a property assessors site also with the above to research what the property last sold for or what price hud had to pay when they took it back. The reason i use the mls w/ the hud is so i can see a picture & get more detail before i look at a property...regards, CWalker
The low end of the market (at least in our area) has gone nuts and "deals" are getting hard to find. HUD forclosures that used to sell for $50-$60K 2 years ago cannot be touched for less than $95-$100K now! I still check the HUD website, but I've pretty much given up on them.
Let's face it, if a "killer deal" comes over the MLS, you can bet the agent will have 10 faxed offers on it within hours / minutes.
I've found that cruising the MLS or www.realtor.com and look for houses that have been on the market awhile. Then make them a real lowball offer. Sure, some will get offended, but you might get lucky.
The other tactic involves cruising neighborhoods and looking for homes that look run down, like the original owner still owns it, and mail them an offer. Only costs you some stamps, envelopes,paper and a little time. It's worked twice for me.
cwal Thanks for the ideas, I like the idea of searching towns in the surrounding area since in Indianapolis they seem to go to owner occupied offers first, and quickly, if they are worth anything. Unfortunately I don't have MLS access to the surrounding areas. Any Ideas on that?
Also I will be checking out the assessors office. I like the idea of knowing how much the bank got it back for...
Inspectorq Thanks a lot
Some great ideas. I have been searching the MLS for property thar has been on the market for a long time but have not made any offers yet. You gave me the motivation to follow through. Any advice on the offer letter?
Fishman
In some jurisdictions you can get a list of out of town/area owners. Send them a leter saying you would like to buy their house and then follow up every three weeks or so with a postcard or letter.
The key to great deals is finding a motivated seller. Most on the MLS are not motivated. Look for people in foreclosure, NOD, etc. Especially the ugly houses, I would think you could bring them current on the loand and take the property subject to, do your rehab and then get a larger profit because of the diminished closing costs.
Another possibility is REO homes, sometimes these are sold through a realtor but other times you can establish a relationship with the person at the bak to where they will call you first..
If your city condems properties they may have a list of properties you could by and may own a few themselves they would love to get rid of.
A 10K profit is pretty thin, it would be my minimum for little work performed by myself. On homes in the 200K range you could lose all that in holding costs if it didn't sell right away.
I am f i nishing a rehab that will have taken two months, 15K outlay on materials and has new owners moving in in two weeks for a profit of 15K. NOt spectacular by any means, just paying the bills..
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