I would suggest that this is not enough of a discount in the purchase price to make the deal attractive. The potential selling price for properties is actually a range, depending upon how hard the buyers bargain. You find find that you have to sell the property for $125K to make it move. Can you be sure you will not?
I hope you are not planning on using a real estate broker to resell the property. That would eat up a lot of your profit, perhaps all of it.
I think that it is admirable that you have been studying for 18 months on the topic. So many people drop out of real estate investing in just a few months. You are showing what it takes to be successful–you are being tenacious.
I suggest that you might want to restudy the LeGrand materials that you have. I’m sure that you will get some ideas that you can apply and make a much more attractive deal than this one. It is hard to buy from a sophisticated investor and flip for an adequate profit, I would think.
Possible First Deal In View!!! (Retail Flip) - Posted by Levi (CT)
Posted by Levi (CT) on January 09, 2003 at 20:57:13:
Hello all!,
I am a newbie investor in Connecticut, but I have STUDIED this business for the last 18 months. I have some LeGrand courses, but in all honesty this site has put me over the top in understanding the height and the depth of this business.(I am still working on the length and width;-)
And I want to thank everyone on this newsgroup!!! Your posts have been VERY helpful and informative. They have helped me to develop this creative investor state of mind.
The Deal: I met a fellow investor at my local REI club who has several condos he is selling in a very nice area.
He has offered to sell me one of his units at a discount for $120,000. Comps say the property is worth $135,000
I plan on flipping this unit for about $137,000.
The unit is almost perfect; move in condition.
I have not read alot of detail on retail flips. There is only six pages in the archives on this subject.
So my question is: Is there anything I should be cautious of in a retail flip, opposed to a wholesale flip?
That’s a very thin profit margin then consider that the payment I figured does not include taxes, insurance, or home owners association fees and what if it takes longer to sell or you have to discount the price to make it sell? That leaves no room for any unexpected expenses. I agree with vvaughn I would take it on a lease purchase if it’s a sellers market and the rental payments are low enough.
Re: Possible First Deal In View!!! (Retail Flip) - Posted by vvaughan
Posted by vvaughan on January 10, 2003 at 09:11:05:
Here are some other ways to skin the cat.
Will he let you Lease Option it or will he let you option it to a retail buyer.
I think when you are looking at small discounts, taking possesion of the property isn’t advantageous. Locking it up is, but taking possession isn’t. Unless you have a buyer