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Oh my goodness this is spot on. I called 3 more agents this morning. All 3 have gotten back to me regarding how much they think we can sell it for. All 3 values are very close to each other and all 3 are over 15k more than the first agent's value.
I'm so glad I came on here to ask you guys.
Awesome!
I only realized that issue was real when I went to sell one of my rentals last year. Called one of the "best rated" and highest-volume realtors out for a market eval. I was told he could get $170, maybe $180. I closed at $215 after digging into the comps myself. I was really shocked that a big, well-regarded agent would really do something like that.
I only realized that issue was real when I went to sell one of my rentals last year. Called one of the "best rated" and highest-volume realtors out for a market eval. I was told he could get $170, maybe $180. I closed at $215 after digging into the comps myself. I was really shocked that a big, well-regarded agent would really do something like that.
The thought of agents shortchanging people for the sake of making a quick sale never even occurred to me.
I've decided to ask this one agent to represent me. She was the nicest one of them all. Very enthusiastic. I looked her up and saw that she sold a couple of houses in my area recently. More importantly, her numbers came out exactly what I was expecting from my independent research. She also gave me a worksheet with breakdowns of what's involved and what we will be walking away with at the end.
A couple of the agents who came didn't seem all that interested. Particularly one of them complained endlessly that 2 of the closet doors were not on. I kept telling her we took them off to do some work and we will put them back on tomorrow. Just found her attitude very weird. Was she expecting perfection? We told her we intended to finish everything after this week and be ready for listing in a couple weeks.
Anyway, here's for the best! After this weekend, we should have the place for listing. Hope it works out!
Added by edit.
If this works out, I have YOU to thank for. Take care, mate.
Ok, here's a question that I have about flipping houses.
I just got off the phone with my sister. I told her the range of what I might get out of the house we flipped. To me, it would be the following:
Total amount house sold for - original price we paid - what it cost for us to fix it up - all the fees and whatnot = what we end up at at the end.
To me, that sounds perfectly reasonable.
My sister on the other hand disagrees. Here is what she thinks.
Total amount house sold for - original price we paid - what it cost for us to fix it up - all the fees and whatnot - homeowner's insurance for the last 2 years - all utilities the last 2 years - all the mortgage payments the last 2 years - 2 years of property taxes - phone bills - cable - internet - everything else that associated with us living there (including grocery) = what we end up with.
Here's my disagreement. The costs she proposed I should include are normal living expenses costs. It means that we would have to pay those costs anywhere we go. These are normal costs for us to just exist in this society. So, regardless of whether we decided to flip the house or not, those costs would still be there.
What do you guys think? When we calculate how much we profit from the flip, should we include how much we've been paying to live there?
Since you lived on the property while you renovated it, you really can't consider the utilities, HOI, interest paid, etc... as holding costs. As you said, these are necessary expenses that you would have had whether you owned the property or not. (Groceries? Seriously?!)
Honestly, I am hesitant to even call this a flip. It took a couple of years and you lived there.
Since you lived on the property while you renovated it, you really can't consider the utilities, HOI, interest paid, etc... as holding costs. As you said, these are necessary expenses that you would have had whether you owned the property or not. (Groceries? Seriously?!)
Honestly, I am hesitant to even call this a flip. It took a couple of years and you lived there.
this. OP's sister is wrong, as he already noted several posts ago that living there was a cost of...living there.
I'd also agree that a 2 year turnaround, where it's your personal residence, isn't really a flip. None of us have even considered the appreciation in the market. What if by market appreciation, the house value would = the high-end of what he's hearing is value anyway?
It's a cool question and thing to ponder, but at the end of the day you didn't do it to make a profit, it was your personal residence, there's no capital gains. You didn't LOSE money with this experiment.
A couple years ago, my spouse and I were in the market to buy a house. Instead of buying a house to live in, we decided to experiment with flipping a house. So, we started scouring the foreclosed home market for a house we could work on ourselves. We finally found a house that we thought we could manage.
So, we paid $87K for it. We spent a total of about $15k in material cost, new AC, water heater, etc.. We also spent lots and lots and lots of sweat equity. Like a whole lot of it.
We just had an agent walk through the house. She has determined that we should put it on the market for $154,900. She also said she is very confident it will sell for no less than $150k.
Is this a good rate of return? Can we pat ourselves in the back about this or is this normal? Or is it bad return?
PS - We have no intention of ever flipping a house ever again. Our next house will be brand new. In fact, we are looking to have it built from the ground up. Way too much trouble flipping a house LOL.
It's not a good rate of return until you sell it, but if you can walk away with $40K or so after expenses it's a great rate of return.
Well, technically it is 150-87-15. The reason is for the last 2 years we have been living there. It's been our primary residence. I don't think it's fair to count what we've been paying to live there as part of this.
That adds to your profit because you didn't have to pay for living expenses for a different place while you were doing renovations, so yeah it's a great deal.
It's not a good rate of return until you sell it, but if you can walk away with $40K or so after expenses it's a great rate of return.
According to the realtor I have chosen, we could walk away with as much as 70k. Hope it works out.
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