Dealmakers Blog – Ramblings of a Real Estate Mogul

Posted By Sean Terry | December 16, 2008

One Mistake………..and Your Done!

So you want to buy a investment home and you want a smokin deal right….…Well, in theory it’s very easy but execution is the nail biter.  I remember the first house I signed a contract on and committed to purchase.  I had every doubt you could think of, I remember I rehearsed in my mind of ways I could back out of the deal. I had no clue what I was getting into, all I knew was I “thought” the house was worth $130,000 and I had a contract on it for $86,000. My intent was to quick flip the property to an investor doing a “double escrow” technique.  What happened?  Read on……

When buying a property there are several things you can do to prevent a huge mistake that could cost you thousands of dollars.  Here are my top 3 tips on buying investment properties at the right price:

Step #1 

Determine the “Value of the Property”, click the link to read how this is done.  This is absolutely crucial, if you screw up this one step than the other 2 steps are worthless.  (Please post a question if you don’t understand this).

Step # 2

Determine the amount of work that needs to be done.  If you are buying properties from the Court House, which require 24 hour cash closing, you don’t have allot of time to really nail down the cost of repairs.  Check out this post “Case Study”, you will see that the house was a reck!!! If you are buying a bank owned home you will have an inspection period and are able to walk the property to get a good grasp of what it will cost to refurbish it to meet or exceed market value.  I suggest you have several a licensed contractors walk the property with you and write up a work order of everything you would like to have done.  Make sure before you go non-refundable with any monies that you have at least 2 quotes from your chosen contractors.

Step #3

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