How do flippers overcome the price history issue?

[GoPhils]

If it sold recently for about market value and wasn’t in terrible shape, then yes it could be relevant. Just as an appraiser makes adjustments for differences in other homes, they can make adjustments for the improvements made. But yes, of course depending on what improvements were made and the quality of them will determine exactly how much that adjustment is for.

[rugrats2001]

Originally Posted by I love boots.

Yes. I see where you are going with this. In a case where someone bought it, needed to do nothing to resell it for a great deal more. It's something you don't see very often. When you run comps on a property and there is just one that is considerably low you have to consider that there is an underlying reason that is the only one and you don't count it. In a situation like this if there is someone to blame for doing anything wrong, and I do say if, it is the agent or seller that decided to sell it for such a low price. It's not against the law to do so, but if a listing agent is this bad at determining property value that they cheat a seller out of 100K they could be liable. There have been court cases like this where sellers sue their agent. If I had a seller that wanted to do this and cheat themselves out of 100K just to unload it quickly I might have them sigh a disclosure that they are knowingly doing so. I don't see how you could point the finger at someone that sees a good deal and buys it. Isn't it what everyone looks for? Including the OP?

So you are saying that, unlike most real estate agents, you wouldn't just buy it yourself without putting it on the market at all? I've seen this countless times in my area. Lots of real estate agents are also real estate investors.

[I love boots.]

Originally Posted by rugrats2001

So you are saying that, unlike most real estate agents, you wouldn't just buy it yourself without putting it on the market at all? I've seen this countless times in my area. Lots of real estate agents are also real estate investors.

I might buy it myself. I had something like this happen recently though it wasn't numbers like 100k difference or anywhere close. A friend wanted to unload a rental he had and called me. A paint and carpet fixer. It's such a hot market that had he listed it doing nothing to it I know he could have gotten more and it wouldn't have taken very long. After explaining the difference between that and what I was willing to pay to buy to flip it he still wanted me to buy it and not have the hassle of listing it, dealing with tenants in it to show it, paying commission and all that. You had better believe all of this was disclosed in our agreement in writing before I did buy it. I showed him a market analysis like I would anyone. Everyone on the same page. No one desperate.

There was another I didn't buy where a friend of a friend was in a bad situation and needed to unload a house yesterday. All I was comfortable doing was listing it for him. It is someone we run into socially and no matter that a lot of money for me could have been made it would not have been worth it to me.