1. lTatis's Avatar
    Anyone here up for a discussion on REI, wholesale real estate and rehabs?

    I have some questions

    Posted via CB10
    09-14-13 09:21 PM
  2. just_luc's Avatar
    Well.. as a Broker that's kinda my specialty but things aren't quite the same up here in Canada as they are down there..

    If you've got questions I'll do my best to answer..
    pkcable likes this.
    09-14-13 09:48 PM
  3. lTatis's Avatar
    YAY! Thanks for any help you provide, usually I get my information from searching the BiggerPockets forums.

    I am a wholesaler and I love being able to bring value to investors. I'm not sure how familiar you are with these types of deals but a big part of it (anything in RE) is structuring the deal. I have a very good formula that works for my area and that is-

    ARV x 70% arv - repairs = price for buyer

    Now my only concern is being able to get a good idea of what the repairs will be. It never has to he exact but the closer the better and the more far off the more amateur I come off

    I like the rule of 20 percent of the ARV
    So if a property is valued at 200,000 a good estimate repair could be placed at 40,000 grand. Other people have recommended to do just 10 X the SQ feet of the property ( usually leaves me with a much lower repair cost) I'm not sure if that's a good method.

    I always leave a contingency in my contract for inspection. That way if my estimates are way off I can always either A drop the deal or B re-negotiste.

    So essentially I'm just looking for the best method a new wholesaler can make decent estimates on the spot. Most of these cash sales don't give me the opportunity to just bring a GC until after the agreement is signed. I guess it's possible to do before but I've been told it makes the actual sale harder with the motivated seller.

    Any ideas, tips or help? Or questions just ask and I'll explain my situation the best I can

    Thanks for your time!

    Posted via CB10
    09-14-13 10:21 PM
  4. rebroker2009's Avatar
    Each property is in need of different repairs, how can u put a percentage on it? I am in Canada as well, 30 yrs Real Estate Broker

    Q10 thanks BL Team
    09-14-13 10:31 PM
  5. just_luc's Avatar
    Yea, I was just about to say the same thing..

    This concept of "real estate wholesale" is very foreign to me.. that's not something that happens in Canada as far as I know.. at least I've certainly never come across it in my years.. so am I to understand that you aren't an agent yourself.. but you attempt to broker deals for distressed properties?

    I deal with a fair amount of power-of-sale / foreclosures but each property has to be taken on it's own merits.. you inspect it and then estimate the cost of repairs if needed and determine a value based on comparable properties.. I can't imagine doing it via some formula..
    09-14-13 10:46 PM
  6. lTatis's Avatar
    To my understanding it does not have to be an exact number just close to it. The buyer will do there due diligence as well and it sort of goes from there.

    Keep in mind these are cash deals on distressed properties that are run down. Usually the discount is so steep there is more then enough wiggle room, I just want to be able to learn to give good estimates myself. The more accurate the easier I can structure my offer, the end buyer (investor) will have his on GC anyway.

    Most wholesaler estimates are taken loosely because different investors have different exit strategies. Some just want to flip other want to hold and rent.

    I just want to learn how to give rough estimates. Sort of like a scaling system of this property is ' good ' ' bad ' ' ugly ' to relay that. I dont have much experience with that and was jusy wondering if anyone had any tips.

    Posted via CB10
    09-14-13 10:54 PM
  7. lTatis's Avatar
    Well isn't that similar to the formula I listed?

    ARV ( determined by recent comps)
    X 70 percent
    - repairs
    = cost investor would pay.

    Each property does have a different repair value, I just wanted to learn some ways of determining that.

    Wholesaling is popular here in the states, I'll post a link that covers it briefly


    Posted via CB10
    09-14-13 10:58 PM

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