Posted by Mike (Seattle WA) on December 29, 2005 at 24:12:25:
And what makes you think that you are walking into 55K of equity on said property? Just because it sold for 305K 2 years ago does NOT mean it is worth that ARV today - especially from what I’ve about the strong buyers market in MI.
Good luck on your real estate agent career. Here’s hoping for a good year for you next!
Found Listing Discounted $100k yesterday. - Posted by Downriver Brian
Posted by Downriver Brian on December 28, 2005 at 22:22:52:
I found a newer home (built 2000, 2500 sq ft) that is REO. House is CLEAN and needs less then $4000 in repairs.
Did some research on it after I walked through…house was bought two years ago for $305k(the highest comps in area). Bank took it back and listed it in June for $350!!! In MICHIGAN! What nutters.
Six months later, no sale. Switched realtors and listed now at $250k.
In my mind that’s $55k+ in equity. I know it’s worth $305 without comping it all the way out because someone paid that much two years ago.
I’m not TOO interested in it right now, because my mentor says in our market to focus on houses that are going to sell fixed up for $230 and less if you want move fast on the selling end.
I found a few more in similar state today (not such high ARV though) so I’m not worried about it.
I’ve walked through at least 12 properties in the last two days. All REO and vacant. Some more distressed than others, but no total trash outs.
The banks seem to be pretty good about winterizing the homes and having everything removed prior to listing in my area.
Oh…and I just got my license in Michigan, so instead of traditional “wholesaling” I’m just going to take my fee as a agents commission…so if anyone wants to look at similar properties in the downriver area, just email me at brian@downriverdeals.com.
If you are looking to buy Steve Cook style (aka 65% ARV - COR) it’s probably a 10 to one acceptance ratio if you put in strong contracts. At least that’s what my mentor is seeing from the new investors in his group.
Here’s comps - I was close - Posted by Downriver Brian
Posted by Downriver Brian on December 29, 2005 at 15:03:27:
Here’s the comps.
Within a one mile radius there have been three sales. All at least 2500 sq ft. All 4 bedroom and 2+ bathrooms.
Lstd: $264,900 - Sold $264,900 (Seller paid $5000 toward closing)
Listed on 5/7/05 - Sold 6/11/05
Lstd: $294,900 - Sold $290,000
Listed on 2/6/05 - Sold 9/24/05
Lstd: $323,900 - Sold $310,000
Listed on 8/23/05 - Sold 4/12/05
The final two are the better comps because they are in the same sub and have the exact same floorplan/exterior, while the first one shares only the size and number of rooms.
The first one sold FAST…I would guess because of it’s more reasonable price for this area. The other two (the better comps) took MONTHS!
Michigan is a strong buyers market…but the area this house is in is one of the “hot” pockets in the Detroit area.
It’s not as if the house is somehow all of a sudden worth $200k ARV. The market isn’t a nightmare spiral…more of a stall and slight check.
Re: Entertain this possibility - Posted by Ed Copp (OH)
Posted by Ed Copp (OH) on December 29, 2005 at 14:20:47:
The house was overpriced the day it was built, and very likely still is.
The local economy in the next year may have a lot more to do with value, than someones immagination.