Thursday, October 8, 2009

No new contracts

I thought we were going to have another house under contract this week but, no can do. The one I really wanted is in a neighborhood where I have an investor looking, the bank is at $75k and I offered $60k. We were not that far apart. After a couple of counters I went highest and best at $62k and they rejected (they were at $70k). This listing agent said there were no other offers on the table. Oh well, I'll keep watching and waiting. Maybe I'll get it even lower. There was another property in good shape, same neighborhood that came on the market at $82k, I offered $62k. This one is not bank owned but a probate. Anyway, they completely rejected. Not sure if they will sell it for $82k b/c the basement is 1/2 dirt. People do not like that much around here.

Okay, so I just read the post over on flippinghome.com http://www.flippinghomes.com/forum/replies.aspx?tp=1&tr=164355#m179198. This has me a little confused/frightened. Did I misread this or is Steve Cook actually saying to hold vs. rehab/wholesale? I've determined that we are not landlord material NOR do we have the money to put in to rentals. I can't wrap my mind around laying off REI during this time b/c it would SEEM to be the best time to buy. But if people won't be buying??!!?! Okay, someone make me feel better about this....

Unsure of what to do next............

3 comments:

Shae said...

Hey Eileen, I've been actively participating in that discussion thread today. No, that's not what Steve is saying...and we seem to have a bit of a consensus regarding the following three points:

Wholesaling is always good as long as there are investors buying (and we know that they are right now).

Holding is great as long as you have a few hundred dollars in cashflow and can withstand a couple rental rate declines and still be ok. Just buy cheap properties!

Rehabbing is great IF the tax credit is extended because there is a large first time home buyer market. Prices would need to be moderate and you'd have to provide excellent value to sell quick.

There's a good discussion going...you may want to go back and read through the whole thing.

Enjoy the rest of your week!

Eileen-WI said...

Thanks Shae. I actually wholesale to both investors and o/o's. I do not strictly wholesale to investors which is why I was a little taken aback, I guess. It was also a bit weird reading it from Steve and has me unnerved. I guess our offers will just have to be that much lower?

Shae said...

Hey Eileen, I forgot you flipped to O/O's too...truly I should've said "Wholesaling is always good as long as there are buyers" -- not so much investor buyers...doesn't matter as long as folks are buying. You buy at great value, you sell at good value, you're good to go :-)

I think we're all well advised pay the least we can for these deals but again, if there are buyers, you're good.