Fellas, I have been making offers on investment properties and valuation of a property is my primary challenge. I come from the school of "if you're not embarrassed to make that offer, you're probably overpaying," so most of my offers are being declined. I do get a counter offer here and there, however just like game, I've moved on to a better deal.
I'm looking for Real Estate experts to weigh in:
- What is the methodology you use for evaluating a property? I'm talking a solid approach here, not go to Zillow or some other generic site.
- I'm extremely conservative when it comes to investing, where I'd like to come below 70% LTV on a purchase. I know that metro Boston is in a mini bubble, so I'm looking elsewhere -- where the property values are stable. Speaking with local appraisers is no help because they try to ballpark the valuation and come close to the bank financing. So how do you go about doing a valuation in a new investing area?
- I have an purchase option on a 2 unit house in Pennsylvania where I can either fix -> flip or hold for rental income. The house itself isn't worth much (purchase price) due to cosmetic renovations required, it's in a lower class neighborhood (not the hood though). Do I:
- Buy and sell immediately (taking less than a $5K net profit).
- Buy, fix and flip (not sure the profit)
- Buy and hold (with rental income for 2 units, I'm looking at a 10% cash on cash return)
Advice?
I'm looking for Real Estate experts to weigh in:
- What is the methodology you use for evaluating a property? I'm talking a solid approach here, not go to Zillow or some other generic site.
- I'm extremely conservative when it comes to investing, where I'd like to come below 70% LTV on a purchase. I know that metro Boston is in a mini bubble, so I'm looking elsewhere -- where the property values are stable. Speaking with local appraisers is no help because they try to ballpark the valuation and come close to the bank financing. So how do you go about doing a valuation in a new investing area?
- I have an purchase option on a 2 unit house in Pennsylvania where I can either fix -> flip or hold for rental income. The house itself isn't worth much (purchase price) due to cosmetic renovations required, it's in a lower class neighborhood (not the hood though). Do I:
- Buy and sell immediately (taking less than a $5K net profit).
- Buy, fix and flip (not sure the profit)
- Buy and hold (with rental income for 2 units, I'm looking at a 10% cash on cash return)
Advice?