Posted by Heather-Tx on December 31, 2002 at 12:50:03:
I can’t answer most of your questions, as I havent used the MLS very much here in Houston. Mostly FSBO, but I can tell you that some investors here use 65% instead of 70. Also I have talked to several that was 15K profit, no matter what percent. You just have to talk to the individual investors I Think, each has different requirments. Me, Im still new and 15K is GREAT! But some wont even look at some under 30. I can’t WAIT Til I have that luxery! LOL
profit margins and MLS in Houston area - Posted by Keith(TX)
Posted by Keith(TX) on December 31, 2002 at 12:13:47:
Hi everyone,
I would like to hear from anyone in Texas, preferably Houston who may be experienced working the MLS. I have read both of Steve’s courses on rehabbing and wholesaling, and was wondering if anyone has made it work in the lone star state. If so, what margin are you buying at, and what sort of strategy do you use? I have been making offers using the specified formulas, and to date have made 55 offers and none have been accepted. I target vacant, foreclosed, bank owned properties. Should I lower my profit margin to get more deals accepted, yet make a little less money ? Is the 70% formula what investors everywhere are using, or do you vary it according to your area, and competition ?
Hi Keith, I’m in Dallas and I have made probably over a 100 offers since June after I read Steve’s wholesale book and I’m still submitting offers. I just submitted five more today 12/31/02. I have a real good agent thats hanging in there with me. However, the answer is no I haven’t got any accepted either using his formula on the “MLS”. I have done my first flip back in Nov. for $10k. If you go to Steve’s site and search the archives for “Jerrold in Dallas” you will see my post. I got that one through a friend’s relative which was a preforeclosure. I negotiated with his banks for two months before they accepted a discounted pay off aka short sale. I am making more progress now with my advertising (signs, flyers, direct mail, and knocking on doors). I am closing on a deal that I got from my flyers on Jan. 6th. This one I got at 68% ltv.
I am trying to stay positive about Steve’s MLS strategy but so far I’m batting zero for over a hundred now six months and counting. I have gotten some counter offers but they were way out range to make a profit. With that said flipping does work here in Dallas/Houston but you have to get to motivated sellers to call you by advertising. The house I’m getting ready to close on on is a perfect example because I spent $570 to duplicate and distribute 3500 flyers door to door and as a result I got 5 calls with 2 preforeclosures I passed on(too little equity and too much money to bring loan current to take over payment)but the one I’m closing on that I should net 30k on. I’m keeping this one doesn’t need any work just paint and carpet clean.
I don’t mention it much on Steve’s site because you will get a thrashing if you say making 20-30 offers a month on the MLS doesn’t work. Steve’s reply is yeah I know it will work just keep at it. I noticed one person from Texas that used to post a lot back in June when I started but evidently she probably has gotten burned out. I will still probably keep at it like Steve says but I will put more effort into What I found that works is ADVERTISING, ADVERTISING, and had I been doing more of this earlier I would have probably closed more deals. I hope this helps shoot me a e-mail and I will tell you more about my advertising.
Re: profit margins and MLS in Houston area - Posted by TKP, Houston
Posted by TKP, Houston on December 31, 2002 at 21:48:04:
Hi Keith, I agree with you. It is hard to find anything based on the 70% rule. I therefore work with slimmer margins. I am always looking for rehab candidates in West Houston. If you know of properties where the margin is not good enough for you please keep me in mind. I’ll be happy to pay a finders fee. TKP, Houston