Posted by Nate(DC) on June 22, 2001 at 21:45:29:
Frankly, I’d rather be the guy that passes on the marginal deals than the one who takes all the marginal deals and works his butt off for small change. Always better to have a larger profit margin. Just because others will accept less doesn’t mean you should!
NHT
Where was the deal here? - Posted by BuddyV
Posted by BuddyV on June 22, 2001 at 20:52:24:
I’ve been buying fixers for almost 20 years. A few weeks ago I was contacted by an older man who had a tiny 900sq ft. 4 room house (2 bedrooms, living room, kitchen and bath) that he owned since it was new in 1954. He owed nothing on it. It was the nastiest, dirtiest, three packs of cigarettes a day with never a window opened nicotaine stained house I have ever seen. But it only needed cosmetics. He was firm on his price of $76,000 cash. I turned it down. He called me last week and said he would take $74K cash, I again turned it down but did offer him $70K under the following terms: 5K upfront to him so he would have the cash to get the apartment he wanted, the remaining $65K @10% simple interest only loan for 12 months. He turned me down. The house is in a HOT area and is worth about $93-95K if in knockout condition, with a real foo-foo kitchen, central a/c, and super curb appeal. It would cost me about 10-12K to get it in that condition. I did not see a deal here so turned down his offer of 74K cash. But I was amazed that after I turned the deal down, he contacted several other people and had them fighting over it. I’ll be curious to find out what it sold for and what the new owner is going to do with it. Perhaps they will hold it for rental. I think I made the right decision as far as rehabbing and flipping this one. The profit I need just was not there. But at the same time, I know I passed up a bargain.
Re: Where was the deal here? - Posted by DanT
Posted by DanT on June 23, 2001 at 05:47:37:
Buddy,
This business is a game of numbers. It also is important to realize that every good deal doesn’t fit every investor. I live in a small Ohio town (40k) and know most of the other rehabbers. You would think we would fight over property but rarely do. Each one of us has different goals, likes dislikes and different financial ideas as to what makes a good deal. My pet statement is I want to buy houses so cheap I can brag about everyone of them. One of the other guys invests heavily into growth, but he hate one area of town that I have had really good luck in. Never lose sleep over the fish that got away, another will come down the stream soon. DanT