Posted by IB (NJ) on June 02, 2008 at 18:17:16:
when he called talking about the soft rental market. Once you let him win that $100 fight you brought yourself more trouble. I would let him go at this point.
Ib
FSBO advice - Posted by John Reid
Posted by John Reid on June 02, 2008 at 13:42:14:
I’m interested in approaching some FSBO’s in my area. I was wondering if some of you seasoned investors out there might be willing to share a story or two about some creative financing you used with your own FSBO’s. Could be good for everyone as it seems more and more are cropping up (at least in my area). There has to be a way to capitalize on this. I’ve never dealt with a FSBO before, but my first impressions are that they are not extrememly motivated to sell and expect more of a retail price. Again, these are my generalizations and I know every situation is different. Thanks in advance for your advice!
Re: FSBO advice-Tye - Posted by Corine
Posted by Corine on June 02, 2008 at 15:43:50:
Tye, what are you doing with your purchases? Holding, wholesale, lease option? You say your doing more and more deals, faster and faster…Man, I’d love to hang a few days with someone like you.
Re: FSBO advice - Posted by Sailor
Posted by Sailor on June 02, 2008 at 15:03:38:
Most folks who try to sell on their own do not have a clue about values; the only thing they know is that their own home is the most valuable on the mkt & that they aren’t willing to pay an agent. What happens is that the properties are over-priced, so get stale on the mkt. When the sellers finally get an agent they end up paying commission + have to reduce their prices. As a buyer, it is frustrating to see folks string themselves out like that because I know where they are going to end up.
My experience w/FSBOs is the same as yours, John. I prefer pre-foreclosure short sales or REOs. Back in the 80’s I did a lot of creative financing, but now I find it simpler to work w/small local banks or buy outright. Teaching sellers one by one how to sell their own properties is a pretty thankless & time-consuming job. Yes, it can be done, but I like to do deals pretty fast now & I can usually get financing w/a phone call.
Tye
Re: FSBO advice-Tye - Posted by Sailor
Posted by Sailor on June 02, 2008 at 16:27:45:
Since I cannot expand my MHP in the near future, I am building what I call a “virtual MHP” in the same area. I buy rentals in the same subdivision & operate as if in a park. The proximity makes it easy to manage & I don’t have the inter-tenant hassles of a real park.
Although sometimes I lease-option a trailer in my park, I’m mostly buy & hold, as my current strategy is part of my estate planning. Trying to leave free & clear rentals to assure future of offspring. Most recent purchase has been set up in an education trust for great-grandchildren.
I wouldn’t say I am doing more & more deals, just the same deals faster. I always buy cheap & rehab, so I don’t like to spend a lot of extra time on the purchase part. I’m not a big-time investor, but have been fairly consistent for nearly 3 decades. I’m long-since retired & spend most of my time on family & good works stuff (see www.ShoeBoxProject.org). However, I have a passion for decent affordable housing, & like to put my $$$ in the vicinity of my mouth. I get a real kick out of turning a dump into a nice family home.
Sorry, but I’m not a mogul–
Tye
Re: FSBO advice-Go for It! - Posted by Jack E
Posted by Jack E on June 02, 2008 at 15:56:22:
It has been my experience that FSBOs are as good a source, if not better, than anything a relator has to offer. FSBOs usually understand that since they won’t have to pay a relator, they can sell under the so called market. You do not have to go thru a third party with a FSBO so it is much easier to make your offer directly to them and get them to understand you logic and what the property is really worth With a relator it is difficult to get them to convey all the information you wish the owner to know. Lets face it, a relator has a vested interest in getting the highest price possible as his cut will be higher. They many times overprice to get the listing. They can be useful, if you find a cooperative one, but my experience is that those are few and far between. If you find a good one use him, but try FSBOs and see what you can do and how much easier it can be. I believe the majority of experienced investors go for FSBOs. How about it experienced investor, who are not relators?
Re: FSBO advice-Tye - Posted by Corine
Posted by Corine on June 02, 2008 at 17:37:00:
Yes you are a mogul. Your thinking about and leaving an estate for your great grand children. I think they don’t make men better than that.
The older I get, the more simple I want things. At this point, what I wouldn’t give to have a few, 5 free and clear houses that would kick off 5-6K a month.
It’s not about being a mogul; it’s about having a good life.
I’m still working on that.
I like the idea that your buying and fixing cheap. I’d love to do that. Well, why the heck can’t I.
I now have possibly three vacancies. Three out of 8. OUCH! How do you spell stress?
In three years I have never raised a rent for fear…looks like it was founded. I have my water/mold drama that came two days after I raise my CA chick. I’m not saying anyoneâ??s at fault.
The other was at 1250, in January when the market was soft he called and told me the market was soft and that he wanted the rent to be 1150, I split it with him, and he was month to month. Now, I put my foot down, sent him a year lease back to 1250. He called and said he would be leaving…fine…then I called back. I can’t deal with three vacancies July 1. I told him 1 year lease, no increase. He said he’d get back to me in the morning. Don’t be ashamed of me. I know, you guys would throw his as- out on principal.
I know, your not proud of me.
But, I placed it on craigs list and already have had several calls.
Re: FSBO advice-Go for It! - Posted by Sailor
Posted by Sailor on June 02, 2008 at 17:14:36:
I am @ the lower end of the mkt, & there the specialty realtors are usually paid a flat fee instead of a commission. They don’t care if I pay 40k or 41.25k; they just want a closing (& most of the properties have major problems). These folks can be really sharp & they get the job done fast. Most of their clients are investors, so it is a whole different ball game than retail RE sales.
Most of the retail agents whom I’ve encountered in the past 30 years have been lazy & lacking in knowledge. However, when you get a good one who knows how you work & what you want, they are worth their weight in gold. I reward mine not only during the holidays & @ closings, but throughout the year w/referrals. In contrast, a bad agent hinders the deal. Actually, I like working directly w/folks, which is one of the reasons I’m doing pre-foreclosures again. However, some deals are only accessible through agents.
Perhaps I should have clarified that I usually buy wholesale, a tougher sell to FSBOs when the family manse is involved. I prefer to spend most of my time doing things other than REI, so I try to be efficient.
Tye
Re: FSBO advice-Go for It! - Posted by Sailor
Posted by Sailor on June 02, 2008 at 16:43:15:
I am @ the lower end of the mkt, & there the specialty realtors are usually paid a flat fee instead of a commission. They don’t care if I pay 40k or 41.25k; they just want a closing (& most of the properties have major problems). These folks can be really sharp & they get the job done fast. Most of their clients are investors, so it is a whole different ball game than retail RE sales.
Most of the retail agents whom I’ve encountered in the past 30 years have been lazy & lacking in knowledge. However, when you get a good one who knows how you work & what you want, they are worth their weight in gold. I reward mine not only during the holidays & @ closings, but throughout the year w/referrals. In contrast, a bad agent hinders the deal. Actually, I like working directly w/folks, which is one of the reasons I’m doing pre-foreclosures again. However, some deals are only accessible through agents.
Perhaps I should have clarified that I usually buy wholesale, a tougher sell to FSBOs when the family manse is involved. I prefer to spend most of my time doing things other than REI, so I try to be efficient.
Tye