I have found it difficult to get deals on properties that only need $500 worth of work. The best deals are the houses that need new roofs, holes in the wall, plumbing problems, termites, etc. For $500 the seller can probably dig up the money and fix it themself or else they realize it is only $500 worth of work. When you start getting into the bigger problems like I mentioned the seller doesn’t realize how much it costs and also knows it will take considerable cash (like several thousand bucks which he doesn’t have).
Find fixer upper, make sure ther is enough equity for profit margin, get a purchased agreement signed, and assign your interest in the property to an investor for a few Ks’.
Not bad but I’d like a heck of alot more money than a few Ks’!
Why not :
Find a property (preferably empty and abandond), offer under market value. Get an OPTION signed, not an agreement of purchase, also get the owner to rent it to you for say 6 months to a year. Do the cosmetics only (500.00 tops) ie paint, cuboard doors, lawn care, cologne up the toilet and away you go. All work takes little effort and no time(tops one week), if you’re a lazy ***, then pay someone a few bucks to do it.
Advertise…find buyer and sandwicharooney!
If the property is already rented than even better (just have pemission to do repairs and show the house)
How much profit to be made? way higher than a few Ks’
Only downfall I guess is that it might take a little longer to sell it to a regular buyer rather than to an investor…so what!..as long as you find a good enough deal where you can resell under FMV, than it should’nt take too long right?
Doing wholesale flips to investors is good to get the bread and butter on the table…but should’nt we capitalize on the profits ourselfves when it’s possible?
I WANT TO HEAR FROM ALL YOU EXPERTS …THANKS GUYS!!
Although I agree with your final comment about capitalizing on the deal fully, as opposed to handing the deal to another investor for a few quick bucks, I doubt you’ll find a house that you can make “many K’s” on that require $500 and some toilet cologne. This is especially true of abandoned homes. In my area, most houses that are abandoned are in need of a pretty hardcore rehaul. I’ve never run into a seller who was willing to sell a home well below retail that had only very minor cosmetic problems. If you can find them, however, you have scored big. Buy it.
You just described the lease option technique. I use the figure that only 20% of the buyers are A credit and go out and get the new loan. Another 60% need some time or some help. 10% need to go the note routine because of credit or ratios. The last 10% you don’t even want as a tenant much less think they might buy. If you can find that buyer in the first 20% you scored a home run. Otherwise you take what you have to work with to make your money. The one thing I would disagree on is abandoned. Empty-many times because the seller has moved to the new job or his new life. It may be ready to go into foreclosure. Remember most areas are sellers market and if a decent house has a lot of equity it can be sold. A 10-20K profit is not much of a problem.