Software Features

BROKERAGE SERVICES

Software Features

Property Data

Research properties and their owners, compile lists, and more.

MLS Comps

A multiple-listing service comparable tool.

Listings

List your properties with Propelio Realty for incredible savings.

Short Sales

If you have an underwater property, our experts can help.

For Education

Blog

Interesting and valuable articles from Propelio and the industry.

Academy

Real Estate education platform led by a team of professionals.

Propelio TV

A channel that gives daily updated archive of our live video.

Discover Propelio

About Us

Get to know Propelio better – explore our story and mission.

Map Coverage and Brokers

Shows MLS coverage and broker transactions in your state.

Referral Program

Share Propelio with friends and family to earn exciting rewards

Template is not defined.
Play Video

​Real Estate Investing Analysis: Expert Advice and Deal Breakdowns 2024

Welcome to another exciting episode of “Grant Teach Me Something!” Today promises to be a unique episode because we’re honing in on your deals, evaluating your numbers, and giving practical advice for real estate investing. At Propelio, we believe in the power of community, which is why we encourage you to #JoinTheConversation.

Grant and Ryan: Your Hosts and Mentors

Grant is an experienced real estate investor specializing in creative financing strategies. He’s the go-to guy for turning difficult deals into profitable ventures. Ryan, on the other hand, is an expert on leveraging data to make informed investment decisions. Together, they make a formidable team committed to helping you succeed.

What to Expect

In this episode, we’ll be analyzing real deals from viewers like you. Whether you have a deal you’re currently working on, one you missed out on, or even one you regret, get ready to dive deep into the numbers.

Analyzing Deals Live

We’ve lined up a few calls to demonstrate how to properly analyze deals. Let’s get started!

Call with Chris: Clovis, New Mexico Deal

Property Details

  • Location: Clovis, New Mexico
  • Condition: Pre-foreclosure listed as a rehab
  • Listed Price: $148,000

Numbers Breakdown

  • ARV Calculation: $195,000
  • Rehab Estimate: $80,000
  • 70% Rule Explanation: 70% of ARV minus repair costs
  • Maximum Offer:
    • ARV ($195,000) * 0.7 = $136,500
    • $136,500 – $80,000 (rehab) = $56,500

Negotiation with Seller

  • Potential Short Sale Approach: Seek legal help to negotiate down the liens.
  • Highlighting Repairs: Be transparent with the seller about required repairs.
  • Proving Numbers/Comps: Always use factual, proven numbers to back your offers.

Unique Situation with Medicare Lien

  • Explaining the Issue: The seller’s Medicare lien complicates the sale.
  • Potential Solutions: Consider options like a second lien or consulting an attorney for lien negotiations.

Call with Sean: San Antonio Probate Deal

Property Details

  • Location: San Antonio, Texas
  • Condition: 1978-built, probate lead
  • ARV Range: $170,000 – $180,000
  • Rehab Estimate: $25,000
  • Seller Motivation: Probate with two heirs, one living in the house

Determining ARV Range

  • Challenges with Comping: The lack of similar-size, fully-updated homes makes precise ARV tricky.
  • Calculating Offer Range:
    • Conservative ARV: $170,000 * 0.7 = $119,000
    • $119,000 – $25,000 (rehab) = $94,000
    • Aggressive ARV: $180,000 * 0.75 = $135,000
    • $135,000 – $25,000 (rehab) = $110,000

Next Steps and Negotiation

  1. Initial Offer: Start at $94,000, making faces and notes to drive the point.
  2. Counteroffers: Be prepared to move up based on seller’s response.
  3. Psychology of Negotiation: Always frame your discount as a “convenience fee” for avoiding hassle.

Call with Corey: Bryan, Texas Creative Financing Deal

Deal Overview

  • Purchase Details: Originally bought for $147,000
  • Appraisal Value: $190,000

Buyer’s Offer

  • Terms Breakdown: $50,000 down, 10% interest rate over 15 years
  • Underlying Lien: First lien of $147,000 at 6% for 20 years

Cash Flow Analysis

  • Incoming Payment: $1,081.84/month
  • Outgoing Payment: $1,059.65/month
  • Amortization Mismatch: Need to re-amortize first lien to match the wrap, increasing outgoing payment to $1,250
  • Net Cash Flow: -$191

Equity Position and Risks

  • Negative Equity: Potential $47,000 out-of-pocket risk if buyer pays off early
  • Potential Solutions:
    • Raise sales price to create better equity spread
    • Refinance first lien to match buyer’s terms

Alden’s Deal: Houston Free-and-Clear House

Property Details

  • Location: Houston, Texas
  • Condition: Free-and-clear house needing $15,000-$20,000 in TLC
  • Asking Price: $200,000
  • Other Offer: $150,000
  • Seller’s Negotiation: Might let it go for $180,000

Calculating Max Offer Price

  • ARV Range: $275,000 – $320,000
  • Maximum Offer Calculation:
    • Conservative ARV: $275,000 * 0.75 = $206,250
    • $206,250 – $20,000 (rehab) = $186,250
    • Offer Range: $180,000 – $186,250

Factoring in Local Market

  • Houston Inventory: Post-flood market glut may require a more aggressive offer.

Overarching Investment Principles

  1. Always Run Conservative Numbers: Avoid overestimating ARV or underestimating repair costs.
  2. Account for All Costs/Fees: Hidden costs can kill a deal.
  3. Know Your Criteria: Stick to your ARV % and cash flow thresholds.
  4. Vetting Deals Thoroughly: Use real numbers, solid comps, and realistic rehab estimates.

Final Thoughts

In this episode of “Grant Teach Me Something,” we’ve delved into real deals from our viewers, providing expert advice and practical strategies for successful real estate investing. By analyzing diverse scenarios, from pre-foreclosure rehabs to probate leads and creative financing deals, we’ve highlighted the importance of thorough deal analysis, conservative number crunching, and strategic negotiation.

Remember, the key to successful investing lies in understanding your numbers, being prepared for negotiations, and always factoring in potential risks. By joining the conversation and leveraging the power of community, you can gain invaluable insights and support on your real estate journey. Keep learning, stay informed, and don’t hesitate to reach out with your deals—Grant and Ryan are here to help you turn challenges into profitable opportunities.

show less

Leave a Reply

Your email address will not be published. Required fields are marked *

Recent Episodes

Play Video
78 minutes

Good morning, everyone! I’m Ron, and today, along with Daniel from Propelio, we’re...

Play Video
10 minutes

Exploring owner financing in real estate opens up a unique pathway to property...

Play Video
16 minutes

Max Maxwell has become a name to reckon with in the real estate...

Play Video
32 minutes

Getting into real estate can be daunting, especially when trying to secure private...

Play Video
47 minutes

Hey real estate enthusiasts! Today, I’m excited to share some invaluable insights from...

Play Video
33 minutes

Hey everyone, Grant Kemp here from Creative Cash Flow. Today, I want to...

Play Video
44 minutes

Good morning, investors! Today, we’re diving into one of the most crucial skills...

Play Video
43 minutes

Good morning, everyone! Welcome back to episode 5 of “Grant Teaches You Something.”...

Play Video
9 minutes

Hey there! Today, I’m excited to give you a quick rundown of how...

Play Video
10 minutes

Today, we’re diving into the basics of owner financing, one of my favorite...

Propelio TV

Do you love learning from your favorite hosts? Subscribe and we will notify you when we release new shows.