OfflineWow, we almost made our 1st deal in the state of Connecticut. We have been working on this deal for about a week now, we got this amazing deal from our Realtor out there. I had ask him if the property was in a good area and he replied: "Oh yes Jason some crime, but not to get up and leave" I believed him and continue on with our conversation. The bank had it listed for $64,900 with a FMV of 108K selling it as-is it needed some updated & cosmetics but overall it was a good looking home. Few days later before we can make an offer the bank reduces it to 44,900 (20k off) its listed price. We were pumped up and thought about what would dean do, he would LOW BALL THE HECK OUT OF IT. So we offed 32k the bank counter with 44k and then we came back with 34K they accepted. We were excited that our 2nd offer was accepted, with our end buyer set up in Connecticut and having CASH & POF Letter ready we knew that this deal was going through. We still needed the repair cost first,day later our contractor called us and told us that he would not be able to do the rehab cost for us cause the area is DANGEROUS and he will not risk it. We were shock to here this from him, all I can think of is if the contractor wont go there what makes me think an investor will buy it from us. So we sent off the info to our end buyer (cross our fingers) waiting for acceptance. He comes back to us, saying that he never seen a well structure deal in about 25 years of doing Real Estate Investing it was one of the best ones he seen. One major thing was wrong and that was THE AREA he went on saying that many people are moving out the area cause of the HIGH CRIME. (drugs, murders etc...) I went back to my Realtor and told him why the deal didn't go through he came back with " I'm sorry Jason that the deal didn't go through." The lesson learn from this deal is to do ALL MY due diligence before I submitted to a buyer.
--Jason & Kelly
"I used to say, "Things cost too much." Then my teacher straightened me out on that by saying, "The problem isn't that things cost too much. The problem is that you can't afford it." That's when I finally understand that the problem wasn't "it" - the problem was "ME!"--Jim Rohn
I always take a negative like yours and turn it into a positive. At least you didn't get stuck with the house, And now you know what to look for. Keep your positive attitude its just around the corner.
Randy
www.adeptpropertiesllc.com
Lesson learned, now you know what to do on the next one. Your out there making it happen and that is a good thing. The way I look at it is its not a failed deal as much as it is a learning experience.
good luck and keep at it.
Richie.
Thanks BC
"I used to say, "Things cost too much." Then my teacher straightened me out on that by saying, "The problem isn't that things cost too much. The problem is that you can't afford it." That's when I finally understand that the problem wasn't "it" - the problem was "ME!"--Jim Rohn
Yes, Im still positive thanks randy
"I used to say, "Things cost too much." Then my teacher straightened me out on that by saying, "The problem isn't that things cost too much. The problem is that you can't afford it." That's when I finally understand that the problem wasn't "it" - the problem was "ME!"--Jim Rohn
We had the same problem with a rental property we were going to hold. We had a distant acquaintance warn us about crime in the area after our agent claimed it was not bad. So we did not proceed with the offer. About a week later there was a shootout close to the property where a police officer and a civilian were killed. I think we made a good decision, although the news was disturbing. The local police web site contains info about crime location and type. This is a good tool to use when working in a new area. Good luck and keep moving forward.
If I were you, i'd find another investor for that home. Trust, you might not see it but its a gold mine; its cheap, the nabe is not that great and with both of those your options are longer than if it were in a nicer nabe and cost more
Find an investor who is interested in having section 8 tenants or firsttime homebuyers who are willing to live anywhere or that live in the area.
Since you know the deal with it, it should be much easier to get someone now. Just be honest with the potential investor and give them options they can use if/when they buy it.
Don't give up on it if you haven't already
You guys did good but not going through with the deal. I would look into finding a more honest realtor as well. At least you guys learned a lesson. Always look in good areas.
Jeremy
This train, Dreams will not be thwarted
This train, Faith will be rewarded
Big wheel roll through fields where sunlight streams
Meet me in the Land Of Hope And Dreams
Bruce Springsteen
elixbrown is right on. I put an offer on a property that had every real possible intention of getting 100K easy. I was going to mack daddy it up to insure a quick sale. And it would have too. I got outbid by just a little and the asking $ was 50K. I went in 35K and lost by just a little. At worst it was a 90K property. Keep your emotions out of buying reselling. You're not going to live there, but someone is quite ok with that price point. I would have been 15-20 behind comps and had the best house in neighborhood.
However, do due diligence and drive by and look on several occassions to make sure your house is not next to the potential meth lab or drug house. I am with you on that one.
When one sets out to take Rome, TAKE ROME!
Greatness courts failure.
SD,
We are either related or completely like-minded because I love buying in crappy nabes because I truly what is down can only go up. And nothing goes up more than real estate.
You can easily,........yes easily find a buyer thats interested in 'downtrodden' or 'economically disadvantaged nabes'.....easily. Why??? Because the amount of investors that would invest in a moderate or high crime area are slim because they know they're options are slim at that moment, but they are ok with it because they know as long as they have a gov't program to pay their rent everything else is moot.
Make this part of your pitch
"I have access to this house/these houses in *&^%$. i know now its what people would call a crappy area and you too but you can easily get section 8 or any other program for tenants and it might be eligible for a gov't restoration grant. i'll research that, but think of all the other nabes that used to be like this; give it a year or two this will be a transtioning nabe and the value will skyrocket"
'Transitioning neighborhood' and 'gentrified neighborhood' should be used in your pitch
The first three words in real estate.
If it seems to good to be true..it typically is. Awesome that you have your end buyers lined up though!!
"Whether you think you can or can't, you are probably right" Henry Ford
Thanks elix....I have read other posts we have been on. I agree, at the very least you and I are on the same page.
I live in a VERY safe, clean, well controlled neighborhood. A few years back a 72 year old widdow was raped 5 doors down from my house at 2 in the morning. I was beneficial in helping to catch the jerk and it turned out to be the local 16 year old creep and it was a "gang initiation thing."
Did this have anything to do with my neighborhood or my property values, or what I know I can get for this place? No, Nada, Zip, Zero.
When one sets out to take Rome, TAKE ROME!
Greatness courts failure.