vicki irvin's (virvin) Blog

       So you've determined your maximum price, how do you actually make an offer? If you are working with an agent then the agent will handle that for you. Do not listen to an agent who tells you that the offer is too low or that the seller will not accept it. An agent is required to submit all ...

      So how do you determine what the house is worth to you? You start by getting "comps" which are the sales prices for similar, or comparable, houses that have sold recently in the same vicinity. The more recent the data and the more like the house you are looking at, the more accurate the com...

  How to Make the Purchase   If you've determined that you may have a good deal, you need to prepare your offer. You need to realize that a real estate transaction is not like making a purchase at a department store. There will be offers and counter-offers and negotiation. It is very much a give ...

        Now that you have gathered all of this information, you need to see if the house fits our winning formula. If you follow this formula closely you will rarely have a losing deal:   (After Repair Value X 70%) - Repair Cost = Maximum Price   Let's try that house again. If the house is worth ...

       This brings us to the last item, allowing for the unexpected. It is one thing to expect things to happen, but how do you allow for it? When working on an older property there are some things that occur from time to time. Things like plumbing or electrical problems, structural problems, ter...

             Another factor in the time estimate is guessing how long it will take to sell. If you are in a strong market, and you price it right then selling the house shouldn't be a problem. If the market is not strong, or is actually slow, you will need to allow more time to sell and price the...

         Another area where people blow it is when estimating the amount of time needed. Flippers, by their very nature, are optimists. You need to be in order to look at the ugly duckling of the neighborhood and see a beautiful swan. This optimism is a double-edged sword. It can help you to envi...

           The next step is to estimate the repairs needed and their cost. If you have extensive contracting experience this part should be easy. However, the vast majority of people do not. So if you don't have the experience what do you do? The number one thing that you need to do is to establi...

  So how do you know? There will always be risk involved, but you can minimize it by sticking to some very simple rules:   Accurately estimate the market value after repair (ARV). Carefully estimate the renovation cost. Figure out the time needed to complete the project. Determine how long it wil...

  Let's get back to our example. We'll assume we can get a loan for 70% of ARV which amounts to $175,000. We'll assume that we are paying 4 points or $7,000. At 18% interest that amounts to 1.5% per month for 4 months or $10,500.   $250,000         = ARV x 70%  175,000           = Loan Amount 175...