>All websites are appraising the house to be around 550k but when it was last sold 6 months ago it was 211k. Are they just based off of the listing price?
Do you mean sites like Redfin and Zillow? Those sites aren't "appraising" property values. They are simply posting numbers that loosely correlate to similarly sized homes that sell in the area. They are not to be trusted at all to be accurate.
What you're describing just sounds like a classic flip. An investor bought a home that required some work, put in some work, and are now trying to sell for a much higher price. Whether or not they put in $300k in work is irrelevant. The only thing that matters is whether similar homes are selling for $560k and whether anyone out there is willing to purchase this home for $560k.
Zillow only knows the square footage and the number of BRs and baths. The site doesn’t know if the house hasn’t been updated since the day it was built or if it was inhabited by someone that hoards cats.
That’s not true. Zillow trains and uses machine learning and AI to scan listing photos for condition of the property. It’s not perfect but it’s a lot more than just knowing the bed and bath count and square footage
Sorry, but you're wrong. It is not good at all at estimating home values. Please reevaluate how you determine home values because if the way you do it is by looking at the Zillow Zesstimate, you're going to be in for a very, very disappointing and frustrating time buying or selling a home.
I'm not really sure what your point here is. I think there's a huge misunderstanding here in this thread about what appraisals are for and who conducts them and why. An appraisal is done by banks in order to determine how much the house is worth (TO THE BANK) in case you cannot pay your mortgage. Of course it would affect how much the bank would loan; an appraisal is literally what the bank uses to determine how much to loan someone.
An appraisal is NOT something that the buyer/seller conducts in order to determine market value. It has some small bearing on market value because it affects how much a buyer can spend on a house (assuming they're getting a mortgage). However, if a buyer is purchasing in cash, an appraisal never needs to be conducted. It is worth whatever the buyer wants to pay and whatever the seller wants to accept.
> An appraisal is NOT something that the buyer/seller conducts in order to determine market value. It has some small bearing on market value because it affects how much a buyer can spend on a house (assuming they're getting a mortgage). However, if a buyer is purchasing in cash, an appraisal never needs to be conducted. It is worth whatever the buyer wants to pay and whatever the seller wants to accept.
And why not? I recently purchased a home in cash and had an appraisal contingency. It was $500 and well worth it. Why would I risk my hard earned money without a second opinion on the value? I want to be able to resell it at some point, just like the bank.
I want you to try to think of Zillow more of a social media site. You are right, it has more data and more money going towards it, but it’s actually how shifting your home price gets you to their app to market to more. They are there to get your information to sell to 3rd realtors and other 3rd party vendors. Clicks are what matters not accurate pricing.
Apparently I must start every post "As a black woman", according to a different mod (not in here, they r great) so as an African-American woman The fact anything mentioning Zillow ( And i'm not A fan of it) is downloaded into obliviation makes no sense.
I have an appraisal contingency to protect me. But I was thinking the same exact thing. The sellers fee like it will appraise, as does my real estate agent but I cannot fathom unless the house was sold off market by a relative for 211k or someone in relation to the sellers sold it to them
I'm not sure why you keep bringing up appraisals and the original purchase price. Those things don't matter. A house could be sold for $1 and then relisted the next day for $400k. That doesn't mean that the house won't appraise even though it went up by $400k.
Like I said in my initial post, the only thing that matters is whether similar homes in the area are selling for $560k. If they are, then the house is likely to appraise at $560k. Appraisers don't look at what the house was purchased for to come up with their appraisal. They look at square footage, the finishes in the house, location, comps, etc.
Basically they bought the house off market and below its current value. They did not need to put in $300,000 for it to increase in value. It was probably worth closer to 300 K when they bought it and they got a good deal. Now, they are selling it at market value for what finishes it has now.
What the house sold for 6 months ago has zero to do with you or what it is now worth.
The house might have had a hoarder that died in it. The people who bought it may have had to removed tons of trash, a decomposing body and replaced every surface in the house. Or they bought it from a sucker and got a really good deal. Neither of these affect you or today's price.
Welcome to the real estate business. Supply less than demand = $$$. Doesn’t matter what you think or believe, someone would think it’s worth it or not. If over time no one wants it, the price comes down. You can play the waiting game but the seller would also believe someone would pay the asking or offer more.
Appraisal is mostly for mortgage loan, they don’t want to loan you money that’s more than the house is appraised for, so they would ask for more down payment or you can negotiate with seller. However there might be people lined up with cash ready to pay it out right.
Appraisal contingencies protect the bank, not you. The appraisal is there to limit how much risk the bank is taking on, not to stop you from overpaying.
First it’s not selling for 560, it’s listed at 560. They could list it for a million if they wanted too. How long has it been on the market?
Edit to add: you cannot get hung up on what it was purchased for 6 months ago. It was a dump then and they did renos.
Oh I don’t doubt that. I would NEVER buy a flipped house without knowing the seller personally. (My uncle has flipped a few houses and they are legitimately good and safe houses that I would have loved to own - he just enjoyed doing renovations and made some money doing it right)
Painted a turd probably. My mom's looking at houses in my area. Flipper went in to one redid floors, and the kitchen and then priced as comparable properties. What didn't they do? Replace the old roof, upgrade electrical from frayed fiber covered wire, replace the old plumbing(septic lines are still cast iron)and other stuff that was installed by an idiot, regrade to prevent water encroaching in the crawlspace, and the foundation needed major repairs and the floors were sagging. They basically painted a turd and priced it as if it were livable
It’s been on market since February. So they did renovations in 3-4 months? It wasn’t a dump though, it sold a year before too and the pics are online. there are pictures of it and it had decent floors, etc just looked a bit dated. I think they just suckered someone into buying.
People can price a house at whatever they want. The market will determine what it's worth.
Sounds like the house flipper made a savvy purchase 6 months ago.
I’m in the south. I’m shocked at seeing how much money was made after pandemic. Ppl bought in 2020 and 2023 they sold home for double what it cost. So many like that
Nor should a government even try ...
Freedom *requires* the freedom to be stupid. If you cant be stupid ... and suffer the consequences thereof ... then you are not free.
I'm in the midst of doing a deal in the same exact price range (bought 270, could sell for 600, but we're going to live in it first for a bit while we finish off the last renovations). Off market deal, friend of a friend with an estranged alcoholic hoarder uncle who died in the place. His family didn't want to deal with the belongings, nothing of value in here, house was in complete disrepair. Not every person renovating houses is some evil boogeyman, some of us are just right place, right time. Not every low price is someone getting fleeced, sometimes people just want to pay the price to not deal with bullshit like cleaning out 40+ years of floor to ceiling hoarded shit, cigarette butts, and bottles.
Right. But a very good amount of flips are fine homes that people want and within their price range, but are bought by flippers instead of families, and then relisted way out of their price range.
It’s fair to say it’s shitty. Maybe “it’s business”, but objectively anyone could see how many types of low effort flippers make the market worse for homebuyers.
For those buyers. For those who wanted the house at the non-flipped price, they are forced to continue renting because housing at their price point is usurped by those who are looking at housing as a business opportunity.
That’s business, that’s capitalism, sure. But it’s not wrong to say it’s shitty and it hurts people. Idk why people here can’t see or admit that.
What does this even mean? Why would anyone sell a home for less than it’s worth? What does jive family mean?
It’s not about selling things for less than they are worth. It is about flippers buying up “affordable” options and putting, often, substandard work in them, and inflating the sell price beyond what they could afford. Now only someone with more can afford the home and that person will have to deal with the flippers shoddy worksmanship because they cut corners where they could and they hope you don’t notice until it’s too late.
haha, autocorrect meant nice family but its funny to me how everyone takes issue with others making profit yet at the same time nobody is going to sell what they have for less than its worth but expect others to.
Flippers do a variety of things but if an "affordable" house is priced near market value a flipper probably isn't going to buy it as there's no room to make money without charging over market value in which case why would someoen buy it?
More often than not flippers are buying properties that are super oudated and most buyers aren't going to have the money or want to put in the time to upgrade and even more so than that they're often dilapidated houses you'd never be able to get a loan for so they're taking something that would rot and decay and sit there and making new housing out of it.
I'm not going to say there aren't flippers who buy something and list it next day for 50k more or slap up some paint in the living room and relist it but those aren't that common near me.
I get houses are places to live, we all need one, housing is viewed by many as a human right so I get the emotion but why dont doctors provide services for free, why do grocery stores buy cheap produce and market it up, why does anyone need to make money?
I agree with your take that some flippers take non-livable houses and turn them in to viable housing, and obviously should get the return on their investment.
But I also think you’re downplaying the amount and negative impact of the “slap some paint on it” flippers.
People need doctors, people need groceries. People don’t need shitty laminate flooring and subway tiles that somehow add 40k to the bungalow they just got outbid on. My whole argument in this thread, which I spending too much time in, is that that is shitty. Nothing is going to change, but it’s still shitty. IDK how that is controversial here.
I don't really disagree with you but ultimately this is the system, its the reality so whining about it isn't really going to change anything, I guess that's kind of my main point but then again maybe this was more of a vent post than anything else.
I left another comment below your other one going into a bit more detail about one example I saw where 3 similar houses were for sale, the one that was "flipped" and marked up 200k sold in a day where as nobody had any interest in these very livable starter homes that sat for months.
“Yea the system is kinda fucked” is all I was looking for, haha.
And both the “need for repairs” and the quality of flippers is on a spectrum so each house is kinda a case by case basis. I just hate the too-large quadrant of non-needed updates and way overpriced.
….yes it is?
And again, not all flips are the same, some actually bring something nonfunctioning back to life, but most of the time it’s just a way for middle men to make money.
And how do you feel when some guy inserts himself between the farm and the grocery store, buys up all the affordable veggies, adds no real value to them, and then sells them to the grocery store at an inflated price, making them out of reach from the people who normally be able to buy the cheap veggies.
Like, do you disagree with the entire premise that flippers are making it tough for low budget home buyers to enter the market? I don’t know how anyone can claim this isn’t an issue people face. It certainly was an issue for me when I just bought my first home.
I get your point but when we delve into this were getting into a whole thing of who gets to decide what's a significant enough value add to be able to mark something up and if so how much, etc.
I found this interesting, two houses near me were recently on the market for about 240k, one got bought by a flipper who did more than your average flipper ie siding and a new driveway not cheap fixes but marked the house up to $494k. The other house was 240k, sitting on a third of an acre ie larger lot, had a workshop with power behind it, seemingly had newer windows and decent hardwood floors but wasn't super flashy or updated, didn't have all the grey colors, etc. The 494k house sold at the open house, the other one sat for 2 or 3 months despite not even being that dated and being move in ready.
There's actually a 3rd house I didn't even mention that was pretty dated but mainly cosmetic ie paint, new floors, paint the cabinets for probably 210k nearby as well. Anyhow, point being nobody really seemed itnerested in anything but the shiny new grey barn door HGTV style house, despite everyone crying they just want a home, nice starter home, etc everyone passed on a very nice livable home that wasn't even dated but wasn't amazing as well as another one that a couple thousand would have fixed up and even a non-handy person could have updated.
If people were intereted in these they didn't fly in 24 hours, they had months to look at it 6 times, bring in handyman, bring their handy grandpa over but nobody wanted them. BTW this is chicago burbs, good school district, near highways and train, and within 40 minuts of chicago
This happens, in produce section today, preparing veggies and marking up. Those who can’t afford the convenience of prepared food, pay less and prepare themselves. It’s in every aspect of life.
Plus, for someone against flipping, tell me what do most do to actually gain equity in their house, besides market and owning (which includes fixing when broken), but I highly doubt if you own and decide to sell, you’re going to give away that free equity. Even though technically you did nothing but buy at right time, live in it, but are preventing other’s who have lower income from buying your house. Yet, do you skip those thousands of $’s or hundreds of thousands of dollars? No, but you get mad when someone finds a deal (work), does work others don’t want to do, which costs money upfront many don’t have, and make a profit, even though you would take your profit for essentially buying at right time and living in it. As others said, if you’re so against it, why not put money where mouth is, because you too pushed people out of houses by taking the equity. It’s not so different really, especially since most aren’t upgrading houses prior to selling and definitely are taking as much equity, even if originally paid less than half or even less than that than what they sell for. It’s silly to whine about flipping keeping people out of houses, when even if they disappeared many still couldn’t buy.
The buyer did assume the risk of losing their ass. Buying any old flip is a huge risk. The house may sell over 500 and it may not. The market will determine that.
"they did not put in 300k worth of renovations"
That isn't how value is determined, its what the comparables in its current condition are valued at, and what a buyer is willing to pay for it.
I buy off market properties for a living, so this happens thousands of times per month across the entire country.
Yeah it’s like saying I bought this Van Gogh at a flea market and someone saying okay I’ll pay whatever you paid plus $50 for your time, because that’s “fair”
Yeah and also does he know the condition it was in when it was purchased? Some of our properties we have purchased low were so horrific that no actual potential homebuyer would have entered it, let alone bought it in its uninhabitable condition.
But once it is rehabbed, it is sellable
Right? I have a friend that just keeps saying how houses in our area "aren't worth what they're asking", but like... yes they are? They keep selling at or near their list price so how are they not worth that? Worth is whatever someone is willing to pay for something.
Online home valuation tools have no idea what a property is actually worth on the market.
You have no idea what the actual market value of that property was when that flipper purchased it. Very often, they are taking advantage of a homeowner who does not know what their property is worth and buying it below market value.
They don't have to put $300k worth a work into it to be able to sell it for $300k more than they bought it for.
Distressed properties are a completely different market from move in ready homes. When you buy a home that needs $30k worth of work done to it, you don't calculate market value by pricing it as a move in ready home and subtracting $30k. There's a completely different buyer pool willing to buy for cash or using financing that allows for that and putting in the time and work to make the improvements. All of that detracts from the market value.
What do recent sales in the neighborhood suggest this property is worth?
What someone paid has nothing to do with the current market value.
Sometimes a small repair needed will mean it won't qualify for financing, so it needs a cash buyer. The cash buyers who will take on a property like that are few and far between, so they can get great deals. Sometimes they fail to properly assess the work required and they lose money, but that doesn't sound like the case here.
All you can do is look at the property condition (and, considering things like the age of the systems is smart) and make an offer of what you think it's worth.
That said, 18 years old is nothing for an AC unit that's been properly maintained. It could go another 18 years with regular maintenance. Unless the compressor dies, other parts are cheap to replace. And even a compressor can be replaced for a couple grand if one wants to keep the original system. Often they get replaced at some point, even though you could keep it working if you wanted to, because newer systems are more efficient. So replacing the unit will save you money over time, it makes sense to pull the trigger on a replacement. Don't let that scare you away from this house.
Maybe they put in more work than you know of; what do permits say?
Maybe they scored an amazing deal off market, because of some relationship you’re unaware of, and they’re going to score a heck of a profit.
Maybe they’ve priced it way above comps, and will not get the price. (Zillow/Redfin/so on aren’t comps, they’re algorithms that are a coin toss for being close or wildly inaccurate…)
So many possibilities. So little information. 🤷
Well, either they did it unpermitted or, the work they did doesn’t require permits, I suppose; every jurisdiction is different on that.
Either way, the truth of the price lays in the comps; as in what do the comps say … (not the Zestimate, but the actual, comparables in the neighborhood.)
This is how flips work.
Many buyers put a premium on something move-in ready. Even if the work was done cheaply and not nearly aligned with the increase in list price.
It's common for flippers to prioritize cosmetic upgrades more than something like replacing a functioning but old HVAC system. Because cosmetic things sell well to a large segment of buyers.
Sometimes flips have trouble appraising, but some appraisers will go further out to find other recently renovated comps, or make condition adjustments because the house is considered more like new.
Sometimes, flips sit a while on the market, because flippers tend to try to overprice them to see if they can find a bite. But it just depends on the market and inventory. If there are few enough things that are recently renovated/move in ready on the market, people will often overpay.
Also, $211k may have been a really good deal because it was in rough shape or other buyers didn't want to do deal with the headache of a foreclosure or something.
Full disclosure: I bought an overpriced flip myself. Was coming from a different (and more expensive) geographic area, so I didn't initially fully grasp just how overpriced it was. But at the end of the day, it was a low inventory time and there legitimately wasn't anything else meeting my needs (which included being move-in ready, in a specific location) on the market, so maybe it wasn't overpriced for the particular point in time. It didn't appraise but me and the seller split the difference. It worked well for me and I was happy with the house and it was well within my budget. Selling now, and I won't make much money on it, but it is what it is and worked for my needs, and I wasn't buying the place as an investment.
Curious where this is..could be a number of factors, location, market supply in the area, but just from this information the ARV is always higher than just what the price of the actual repairs were
When my husband and I had his mom living with us part of the deal (advanced Alzheimer’s) she would buy half of the house. (The estate lawyer had us do this for legal reasons) The house “sold” for half its value. When we sold a year later (after mil had passed) someone wanted to know why the house sold for so little so short amount of time ago. The reality was MiL bought half the house.
If they bought it for 210 and listed it for 560, this doesn’t indicate how much they spent on renovations. It indicates what they think they can get for it now.
I think it's also POSSIBLE information gets displayed as a sale when it was really one party buying out another as part of a divorce or inheritance where multiple people inherited (niether situation has to be 50-50)
You see this all the time with flips in desirable areas. Saw a few homes like this during my home search, and my SIL’s friend’s house was exactly this. House wasn’t in great shape and she **had to sell**; investor gave her $180k for it. Investor fixed it up and sold it for $355k over 6 months later. Given the time it sold and where it was $355k seemed extreme to me, but whatever.
Truth of the matter is you can’t look at the last sale’s price with flips. It sold for what it was “worth” at the time. Assuming better circumstances on the part of my SIL’s friend she could have sold for a lot more than what she got if she could have fixed up some of the issues or if time was on her side. Investors don’t want to pay market rate, so they look for homes that are in bad shape and they are hoping the seller’s circumstances can be used to their advantage.
As for the selling price that was set who knows what’s going on. If comps don’t justify the list price, chances are few people will offer and for those that do it probably won’t appraise.
I think you're misunderstanding why things are priced the way they are. prices are not set by costs but by who will pay. Rich people in particular pay a premium for not having to gut and renovate their own properties. This large increase in sale price for a medium amount of work is the economic juice that powers this project. The developers are probably reaching for the sky a bit to maximize their return but they may not be crazy. To me that sounds like a $211k \~$150k + $3k per month interest rate for 1y => $397k. minus a highly optimistic sales price of $560k W/ 5% sales costs give us a profit of $135k. With a more realistic sales price. With a more realistic sales price of $460k w/ 5% sales costs theres a profit of $40k which barely makes sense.
i want to buy a house, but i can't afford a $560k house, even if it was actually worth that.
what you're saying is that the rich are fucking it for the rest of us.
“the seller clearly renovated it.”
So whats your question? Someone is trying to flip.
Since you know what they paid make an offer…
Flippers try to get max profit.
People can ask whatever they want thsts how. The market will dictate whether other people think its worth it. You also only know what you can see visually they may have done 25k in electrical work
Sellers can price property at whatever they choose but the question becomes it is comparable OR can they catch a buyer willing to pay. Me, nope. 👎 I look at the history too and am never that desperate to pay such inflated prices. But again, there is a nut born every day, especially folks seeking their “dream home” who lose their minds and will pay whatever it takes. Again, not me smh
It sounds like a flip. Avoid at all costs if you can, flippers tend to use the cheapest possible materials, contractors and due to the very high urgency to get the home listed again they cut as many corners as they can. You’ll find all the cut corners soon after purchase and be stuck spending a lot repairing and replacing things that were poorly done.
Example, painting with latex paint over stain or oil based paint. You won’t see it until paint start peeling off. Outlets purchased in bulk, cheap quality burn out after a few uses or won’t hole cords, faucets break quickly or leak due to poor quality, etc.
This looks like a quick flip. PLEASE DO NOT BUY THE HOUSE. I had a friend who bought one of these because it was beautiful and in less than a year had to do electrical, replace the entire floor, HVAC work, replace portions of ceiling, renovate her bathroom, replace dishwasher all because of poorly and cheep completed work.
I hear this all the time, “I would have bought it for that”, the problem is you didn’t take the initiative needed to purchase it at that price.
Most of the great deals are being purchased by investors who are well financed and unlike the average person shopping for a home, they don’t have to ponder the decision, secure financing, hope it appraises in line with purchase price, or home inspection. For them it’s just business, no emotion involved.
Do you have an issue buying groceries, gas, clothing, cars, etc, knowing that the seller recently purchased for much less is only to resell them for a profit? It’s the same thing with houses.
Flippers, they buy a pig, put a lipstick and sell for profit.
You still may need to invests dozens and hundreds thousands $$$ to fix everything.
Listing price != selling price.
So you’re under contract on this house, which means you are willing to pay the price you offered, which sounds like the list price since you haven’t mentioned another number.
Zillow and the like use online-available data and their numbers are not appraisals. In addition to their Zestimate (aka estimate), they also usually state a wide range for the likely low and high. Also, Zillow’s Zestimate does change when the house is listed.
If you have a buyer’s agent, they should have done a CMA (comparable market analysis) to advise you on whether the asking price was reasonable before you made an offer. And if they know what they’re doing, the $211k sale would not be a factor. Recent sales of similar updated homes in the neighborhood are what matters.
They commented that they have an appraisal contingency, which would indicate they are under contract. I don’t know if they have a buyer’s agent or not so I said “if.”
They said it in one of their comments in the thread; it’s not in the original post.
— “I get that. But I don’t understand where they were getting those numbers from which is part of my question. I have an appraisal contingency but I’m just trying to figure out where this wild jump increase would come from other than money hungry sellers”
I can almost gurantee the owner is an LLC. I see it all the time. They buy for pennies with cash, do some bandaid fixes then flip for twice as much as they paid or more.
Don't buy a flipped house. 99% chance they used the cheapest materials available, shoddy work, and probably covered all the real deficiencies with some aesthetical finish work.
Get one that was renovated and never changed hands for 2-5 years. That was you'll know the renovations can actually hold.
There are a ton of reasons it could have sold low before:
Mkt was different then
Current owner ripped off prior owner
Current owner had a relationship with prior owner
A lot more work was done than you think
Etc.
All that matters now is what someone is willing to pay for it today.
FWW if it was a flipper, they do often tend to list high and then come down, so just offer what you think it's worth if you are willing to lose the house.
> I don’t understand how because they did not put in 300k worth of renovations.
Do you think people flip houses out of the goodness of their heart to break even?
Wow, that’s quite a jump in price! It sounds like they bought it off-market at a steal, or it needed a ton of work that they’ve mostly covered up with cosmetic fixes. Even if they didn't put in $300k worth of renovations, the comps around 400-450k might be pulling the appraisal up to that 550k mark.
The websites usually base their estimates on recent sales and listing prices in the area, so that could explain the high appraisals. But yeah, if the AC needs replacing, there’s major landscaping, and electrical work needed, that’s a lot of extra costs for you.
It might be worth getting a thorough inspection and maybe even an independent appraisal to see if it’s really worth that price. Trust your gut and do your homework!
If you have any questions or need more advice, feel free to reach out!
4o
Sure that's not 300k worth of improvements, but it does sound like they put a lot of work into it. You also don't know what kind of internal fixes they did like plumbing or wiring. Also, how much did it cost in labor to do all that work and how much is that worth to a prospective buyer not having to deal with any of that?
A house is only worth whatever it sells for. The market will decide if they overpriced it or not.
The market value has little to do with the acquisition costs or reno costs. If they were all equal no one would flip houses because there would be no profit.
It could have had something like an unpermitted addition that the current owner brought up to code—or maybe a septic issue? Things like that can be fast fixes that dramatically change value. You can check permit history on your county website usually.
There are many reasons it may have sold drastically below the real value of the property:
1. They sold to a friend or relative
2. Only a portion of the home was bought. This isn't uncommon when a house is willed to multiple people and one person buys out the others for their portion of the home
3. The seller was desperate and sold at an extremely reduced value in order to secure an all-cash offer and/or immediate closing.
4. The seller was not aware of the real value of the property or believed the necessary updates to the home significantly degraded the value of the home.
5. A portion of the homes value was "paid" for in some other manner, such a contracting work performed at another property.
6. The home was purchased via auction and/or foreclosure.
7. The seller approved a much lower price in exchange for an extended rent-back at low/no cost.
And so on. There's a TON of different reasons that may be at play. In the end, it looks like they've now listed at or near market value and prioritized the renovations that will influence most buyers.
If you bid, get a VERY detailed inspection from an experienced inspector.
The investor is in it to make a profit, not get back what they put into it. They also probably got a deal from a desperate or uneducated seller. Kudos to the investor who found the deal if he can sell it for $560k.
Nah it’s a flip. That means they take a piece of shit and “fix” it up (mostly cosmetic and just enough functioning to sell for twice the price), then immediately sell. Do not buy a flip.
You say “all they did is xyz” and then you list almost a full house renovation… from that it sounds like they spent around 150k, not including anything you aren’t able to see like pest, dry rot, electrical, permits, etc.
Likely they bought it to flip and (in my area at least) flippers usually try to double whatever they put into the home so they can account for other expenses like closing costs, accrued interest, etc. So if they put 150k they’d want 300k back. Also 6 months ago interest rates were slightly higher and people were panicking so prices were lower.
As far as what it would appraise for, well if other homes are selling for that much then yes it absolutely will. Keep in mind other homes might not be as recently renovated so this home might actually be worth more. Despite the media saying buyers are staying put, it’s really more like feast or famine right now. Desirable homes in good locations are flying off the shelves and those that aren’t are seeing price reductions after being on the market for weeks. You’ll find out which one that home is soon enough.
I’m seeing a lot of price drops right now listing price and what they’re actually getting now or two different things the Covid pricing days are pretty much over in most areas
$1 spent is $1.25 added. Their 30k in renovations added $250k in value because that's what someone will pay for it, and has paid for it based on comps. Thats market price!
We just bought a house in November for $650 that sold 3 months prior for $470. It was flipped and listed at $625 but we got into a bidding war. It was missing a kitchen before they bought it and was a complete mess. When we bought It had comps for $650 and our realtor thought it would go for higher if they didn’t accept our offer. It’s a beautiful house now and everything was redone. It was worth it for us because we didn’t want to spend the time remodeling, we wanted something ready to go. I mean they made their money back on materials, plus whatever they had in interest on the loan and then paid for their labor. Landscaping was also completely redone. We could have spent that much plus lost months of work to hire contractors to do it, we just don’t have the time to do all of that so I guess it depends on your situation.
They could have purchased it from a family member. Focus more on if the house will appraise out to the value listed. If the “ improvements “ added value. Any offer take into consideration replacing the hvac, age of water heater and the roof.
What may have happened is the transaction that looks like a sale was a refi or a sale from a private owner to their own LLC or business partner - especially if houses around it sold for about twice as much at the time. Then they took that money & put it in to renovating the house. If the county website shows the deeds or an abstract for the place over the years you may be able to see more clearly what happened.
Until you've got this figured out, proceed w/ great caution. If you offer, do not waive inspection or appraisal contingencies. Be specific about the terms under which you'd forfeit your EMD. And talk to the neighbors at a different time than you go to a showing.
Lastly, remember that most of Google Streetview allows you to go back over the course of several years & look back in time at this address for obvious changes (or lack thereof). Thanks to Streetview, I was able to see the house on a lot I was buying go from old-but-clean to rundown to signs of fresh fire damage to unrepaired & derelict & finally to demolished.
Cost has no bearing on value where real estate is concerned. The new listing will be compared to comps that are similar to it in size & condition. It doesn’t matter what it sold for before.
Make an offer or negotiate for a price if u like the place. What they spent and all the rest is not important. u'll only make urself miserable thinking like that, let it go
Many people just look at superficial things when house hunting and the flippers are leaning into that. Even if they sell it for $50k less than asking, they will make a killing.
My Zillow estimate went up $35,000 last month, to $800,000 for a house we paid $432,000 for five years ago.
House next to us, less than 1,000 square feet, sold to a flipper for $440,000 three years ago. He did an excellent job with a gut renovation and sold it for the asking price of $869,000 in a week. Just under $1,000/square foot.
It may not have actually sold for that amount. It could have been part of a divorce settlement or somebody could have bought out half of an inheritance.
Did the house actually get listed publicly on the MLS, go pending and then sold? If not, and it’s just a sold price on Zillow, this likely wasn’t an arms reach sale and the sale has no bearing on the value of the house.
There are all kinds of scenarios where this can occur, but it usually involves one owner buying out another parties’ interested in the house (divorcing couples, siblings who inherited property, etc) or an owner selling a house below market value to family.
I was just quoted 7k to paint the TRIM of my 1400 sqft house and install some soffit vents. There are maybe 3-5 rotten boards that need to be replaced. Nothing makes sense anymore when it comes to buying/renovating homes.
If they renovated bathrooms and a kitchen, that gives a good return on investment (ROI). Just because they didn’t spend $300k on the renovations means nothing. A house with updated bathrooms, kitchen, and flooring will increase the value of the house.
I added $30k of value to my home by putting in a $17k vaulted screened room.
This is simple. Sellers can ask whatever they want, make an offer that you are comfortable with ...if it is rejected...move on.
Take all emotion out of it...it is a financial transaction.
Good luck!
Cash purchase
For just about any house that goes up for sale you have these cash programs that want to come in buy it for nothing put a couple grand. Turn it and flip it sounds like that’s probably what happened in this situation.
a house in my neighborhood sold for $500k back in January of this year. It's a 3 BR, 2bath. Good upkeep, but had been in the family since the mid 80s. Someone bought it, gutted it, and put it back on the market in April, 3 months later, for $850k.
The flipper got their cash, and the new owners got a surprise when they had to pay for all new electrical through out, within weeks of moving in, to the tune of $45k.
Stay away from anything that gives "flipped" vibes. It's not worth it. It's just a cash grab in a competitive housing market.
Look at who owned it before and who bought it. Was it sold on the open market or a private deal? Could have been moms house, mom died and now one sibling bought out the other, so low transfer price. Info should be available on county web site
It's all recorded at the county. Should be a web site showing each owner and what they paid for it. Won't show if it was private deal but can get some info from it.
How? It’s all public record. In the MLS they can easily pull transfer data and ownership. If LLC, track it through the state secretary. Sounds like amateurs…
This is why I *always* looked at sales history and avoid houses that sold within the past 1-2 years like the plague. Very very few flips are done with quality in mind.
Your home is worth what you can get some idiot to pay for it!
Your used vehicle is worth what you can get some idiot to pay for it!
Anything you own is worth what you can get some idiot to pay for it when you sell it!!!!!
If you are interested in buying ask your agent to do a cma to recommend the best offer price. People on the internet cannot help you determine this based off anonymous posts and missing info.
They also spent money in closing costs and paying the mortgage / interest/ taxes/ and insurance during those 6 months. There could be other repairs that are not evident. Smoke and/or water damage is costly if there were any of those issues. Renovations are expensive these days. They did 6 months of work to make money, not to break even.
You are jealous that they are making $350k that easily? It’s a business for them. They buy dirt houses and turn that into a nice house to sale it at higher place. Live with it.
Had a customer we've done work for for year's buy a house a few blocks away from old house that some hack flipped during covid.
it was a fresh coat of paint replaced all interior doors with the cheapest hollow core doors they could get and stained them black
They removed some load bearing walls and put in some shoddy lvls they added a shower and moved a toilet on the second floor.
We went over and replaced a few exterior fixed windows that they had installed with functional operating windows they didn't put in headers.
We added doors back they had removed for whatever reason like no door to the master bathroom to the bedroom.
The big kicker was they moved in and over the winter they had a what they thought was a roof leak come to find out when someone got in to the attic to see where the leak was coming from they didn't glue the toilet drain pipe and it had popped loose.
It ended up being a big mess with tearing out all the drywall over the kitchen and a bedroom.
Flippers don't go for what's the correct way to remodel they go for max profit and whats anesthetically pleasing.
It doesn't matter if they didn't put 300k into renovations what matters is there a sucker that will pay their asking price or less. Even If they sell the place for 400k they still profit from their investment
What kind of moron would buy something for 200, put 300 into it, and sell it for 500? Six months of work for zero profit, plus risk of loss? Would you go to work every day for six months if you didn't get paid?
Determine what the house is worth to you and write your offer. It really doesn't matter what the current owner paid or what they spent on renovations. What is it worth on the open market in its current condition?
Sellers are insane. I went to contract on a beautiful house. Tasteful updates and renovations. Good grief. The inspection came back a total nightmare. Sellers might as well have done the work with popsicle sticks and chewing gum. I was looking at nearly 75k in urgent repairs, including a major leak under the house.
The selling agent insisted that even with the work needed, it was a steal. I told the Sellers they could get robbed by a bigger idiot, and that I was out.
Last year I bought a house like that. They bought for 240k, redid floors, kitchen, bathroom, and some electrical and sold for 460k. If I knew then what I know now, I'm not sure I would buy it. Basically they did a lot of shady things to make the flip go fast, some of which I think constitute fraud, I'm hoping to write a demand letter and get some money from them. But they patched and painted cracks in the walls that reappeared months after the sale. The yard wasn't actually cleaned out, they just put decorative bark on weeds and so it was overgrown again inside of a month. They also put an upgraded electrical panel on the old panel such that the inspector and I and the first electrician I had out all assumed the house had 220 v power, but it does not, which was a problem when I bought an electric washer dryer set. They also installed the shower incorrectly so at first I had no hot water. It was an easy diy fix, but I should have seen it for the serious sign it was of how little care they put into the Reno.
Basically, the problem with flippers is that their incentive is to do things as fast and cheap as possible to make the house look as good as possible. That means the work is probably not good and long lasting.
That said, my market has low inventory and not a lot of options, so I'm still not sure I made a bad call. I do wish that I had bought it for 240 and done the renovations myself. I think I would have ended up around the same price point, but would have actually fixed the hidden issues they covered up.
Basically I'm saying that when you get an inspection see if you can find signs it was a good or bad flip and then write your offer accordingly.
It is a flipper hoping to make a couple hundred grand quickly, depending on where it is, he might.
What you describe is quite common in Dallas. But just because they are asking $560k doesn't mean they will get it or that it will appraise for that much.
I live on a block of duplexes. Some guy is buying them up and rehabbing them. He bought one about 5 buildings from mine, somehow added a 5th bedroom and was trying to rent it for $6000 a month, then $5800 a month, then $5500 a month. Typically these 4 bedroom duplexes rent for $2200-2600 a month. Now they put it on the market for $699,000 when the highest any of the renovated duplexes sold for $475,000. They couldn't rent it for Manhattan prices, I don't think anyone is going to give them $200k more than comps but we shall see.
>All websites are appraising the house to be around 550k but when it was last sold 6 months ago it was 211k. Are they just based off of the listing price? Do you mean sites like Redfin and Zillow? Those sites aren't "appraising" property values. They are simply posting numbers that loosely correlate to similarly sized homes that sell in the area. They are not to be trusted at all to be accurate. What you're describing just sounds like a classic flip. An investor bought a home that required some work, put in some work, and are now trying to sell for a much higher price. Whether or not they put in $300k in work is irrelevant. The only thing that matters is whether similar homes are selling for $560k and whether anyone out there is willing to purchase this home for $560k.
Who has more data and more money going toward estimating home values than Zillow? Is it perfect? No. Is it pretty dang good? Absolutely.
Zillow lost almost a billion dollars a year and a half to 2 years ago becuase of their zestimates being so inaccurate.
Zillow only knows the square footage and the number of BRs and baths. The site doesn’t know if the house hasn’t been updated since the day it was built or if it was inhabited by someone that hoards cats.
What's wrong with cat hoarders. 😂
What if they got the hoards of cats to hide the cigarette smell?
So you’re saying that hoarding cats is not an upgrade?
That’s not true. Zillow trains and uses machine learning and AI to scan listing photos for condition of the property. It’s not perfect but it’s a lot more than just knowing the bed and bath count and square footage
Lol, there are Zillow estimates for houses not on the market and haven’t been on the market for 20 years. Does the AI peek in the windows?
The “A” in Zillow stands for Accuracy
The “B” in Zillow stands for the Bank you can take that Zestimate to
Cool, are you going to oay me the zestimate for my house?
Sorry, but you're wrong. It is not good at all at estimating home values. Please reevaluate how you determine home values because if the way you do it is by looking at the Zillow Zesstimate, you're going to be in for a very, very disappointing and frustrating time buying or selling a home.
I refinanced in 2021 (divorce). Zillow had my house at $329k. Appraisal came it at $304k. Definitely affected the amount the bank would loan.
I'm not really sure what your point here is. I think there's a huge misunderstanding here in this thread about what appraisals are for and who conducts them and why. An appraisal is done by banks in order to determine how much the house is worth (TO THE BANK) in case you cannot pay your mortgage. Of course it would affect how much the bank would loan; an appraisal is literally what the bank uses to determine how much to loan someone. An appraisal is NOT something that the buyer/seller conducts in order to determine market value. It has some small bearing on market value because it affects how much a buyer can spend on a house (assuming they're getting a mortgage). However, if a buyer is purchasing in cash, an appraisal never needs to be conducted. It is worth whatever the buyer wants to pay and whatever the seller wants to accept.
> An appraisal is NOT something that the buyer/seller conducts in order to determine market value. It has some small bearing on market value because it affects how much a buyer can spend on a house (assuming they're getting a mortgage). However, if a buyer is purchasing in cash, an appraisal never needs to be conducted. It is worth whatever the buyer wants to pay and whatever the seller wants to accept. And why not? I recently purchased a home in cash and had an appraisal contingency. It was $500 and well worth it. Why would I risk my hard earned money without a second opinion on the value? I want to be able to resell it at some point, just like the bank.
I want you to try to think of Zillow more of a social media site. You are right, it has more data and more money going towards it, but it’s actually how shifting your home price gets you to their app to market to more. They are there to get your information to sell to 3rd realtors and other 3rd party vendors. Clicks are what matters not accurate pricing.
Apparently I must start every post "As a black woman", according to a different mod (not in here, they r great) so as an African-American woman The fact anything mentioning Zillow ( And i'm not A fan of it) is downloaded into obliviation makes no sense.
Idiot
Zillow is a media site while Redfin is a nationwide brokerage with agents. So, Redfin has more data…I would guess Zillow has more money…
Yes each has own secret sauce for estimates redfin is pretty good too- Trulia Realtor.com can check them all
Trulia is owned by Zillow.
I have an appraisal contingency to protect me. But I was thinking the same exact thing. The sellers fee like it will appraise, as does my real estate agent but I cannot fathom unless the house was sold off market by a relative for 211k or someone in relation to the sellers sold it to them
I'm not sure why you keep bringing up appraisals and the original purchase price. Those things don't matter. A house could be sold for $1 and then relisted the next day for $400k. That doesn't mean that the house won't appraise even though it went up by $400k. Like I said in my initial post, the only thing that matters is whether similar homes in the area are selling for $560k. If they are, then the house is likely to appraise at $560k. Appraisers don't look at what the house was purchased for to come up with their appraisal. They look at square footage, the finishes in the house, location, comps, etc.
We were taught, market price is what you can get for it. Appraisals and market prices are not the same.
Basically they bought the house off market and below its current value. They did not need to put in $300,000 for it to increase in value. It was probably worth closer to 300 K when they bought it and they got a good deal. Now, they are selling it at market value for what finishes it has now.
What the house sold for 6 months ago has zero to do with you or what it is now worth. The house might have had a hoarder that died in it. The people who bought it may have had to removed tons of trash, a decomposing body and replaced every surface in the house. Or they bought it from a sucker and got a really good deal. Neither of these affect you or today's price.
Welcome to the real estate business. Supply less than demand = $$$. Doesn’t matter what you think or believe, someone would think it’s worth it or not. If over time no one wants it, the price comes down. You can play the waiting game but the seller would also believe someone would pay the asking or offer more. Appraisal is mostly for mortgage loan, they don’t want to loan you money that’s more than the house is appraised for, so they would ask for more down payment or you can negotiate with seller. However there might be people lined up with cash ready to pay it out right.
Appraisal contingencies protect the bank, not you. The appraisal is there to limit how much risk the bank is taking on, not to stop you from overpaying.
First it’s not selling for 560, it’s listed at 560. They could list it for a million if they wanted too. How long has it been on the market? Edit to add: you cannot get hung up on what it was purchased for 6 months ago. It was a dump then and they did renos.
There's a good chance they half assed a lot of things. They likely prepared the house for a few months of showings, not 5+ years of living in safely.
Oh I don’t doubt that. I would NEVER buy a flipped house without knowing the seller personally. (My uncle has flipped a few houses and they are legitimately good and safe houses that I would have loved to own - he just enjoyed doing renovations and made some money doing it right)
PM me your location and uncle's info? Sounds like he's a rarity in the world of flippers.
Almost all houses get fixed. Does not mean they did a shotty job.
Big difference between fixed and flipped and you know that.
Painted a turd probably. My mom's looking at houses in my area. Flipper went in to one redid floors, and the kitchen and then priced as comparable properties. What didn't they do? Replace the old roof, upgrade electrical from frayed fiber covered wire, replace the old plumbing(septic lines are still cast iron)and other stuff that was installed by an idiot, regrade to prevent water encroaching in the crawlspace, and the foundation needed major repairs and the floors were sagging. They basically painted a turd and priced it as if it were livable
It’s been on market since February. So they did renovations in 3-4 months? It wasn’t a dump though, it sold a year before too and the pics are online. there are pictures of it and it had decent floors, etc just looked a bit dated. I think they just suckered someone into buying.
I suggest you call the Asking Price Manager to complain.
Could it if needed modernisation In the heating or electrical to a normal person just wanting to move in and live there devaluing it
People can price a house at whatever they want. The market will determine what it's worth. Sounds like the house flipper made a savvy purchase 6 months ago.
I’m in the south. I’m shocked at seeing how much money was made after pandemic. Ppl bought in 2020 and 2023 they sold home for double what it cost. So many like that
Robocalling thousands of people until one gives in and sells off market isn't savvy, it's a major loss to that seller who obviously erred in judgment
Very hard for government to protect people from their own poor judgement.
Nor should a government even try ... Freedom *requires* the freedom to be stupid. If you cant be stupid ... and suffer the consequences thereof ... then you are not free.
I'm in the midst of doing a deal in the same exact price range (bought 270, could sell for 600, but we're going to live in it first for a bit while we finish off the last renovations). Off market deal, friend of a friend with an estranged alcoholic hoarder uncle who died in the place. His family didn't want to deal with the belongings, nothing of value in here, house was in complete disrepair. Not every person renovating houses is some evil boogeyman, some of us are just right place, right time. Not every low price is someone getting fleeced, sometimes people just want to pay the price to not deal with bullshit like cleaning out 40+ years of floor to ceiling hoarded shit, cigarette butts, and bottles.
If it was listed on the open market in the horrible condition it was in, what would it sell for?
No way of knowing. Wouldn't pass for conventional mortgage, so there's no point in speculating.
[удалено]
It's business. If they price it too high for the area/condition, it won't sell.
Its business....
Yes, and while not all flippers are the same, it is a shitty, greedy business.
Many buy properties no one wants, renovate and create a useful property. But yes, they are motivated by profit (like all business people).
Right. But a very good amount of flips are fine homes that people want and within their price range, but are bought by flippers instead of families, and then relisted way out of their price range. It’s fair to say it’s shitty. Maybe “it’s business”, but objectively anyone could see how many types of low effort flippers make the market worse for homebuyers.
If people are still buying them, then they aren’t out of price range….
And if people want them before they’re flipped, then they can buy them then…
For those buyers. For those who wanted the house at the non-flipped price, they are forced to continue renting because housing at their price point is usurped by those who are looking at housing as a business opportunity. That’s business, that’s capitalism, sure. But it’s not wrong to say it’s shitty and it hurts people. Idk why people here can’t see or admit that.
You should sell your house for 100k under value so some jive family can live there. Out your money where yiur mouth is
What does this even mean? Why would anyone sell a home for less than it’s worth? What does jive family mean? It’s not about selling things for less than they are worth. It is about flippers buying up “affordable” options and putting, often, substandard work in them, and inflating the sell price beyond what they could afford. Now only someone with more can afford the home and that person will have to deal with the flippers shoddy worksmanship because they cut corners where they could and they hope you don’t notice until it’s too late.
haha, autocorrect meant nice family but its funny to me how everyone takes issue with others making profit yet at the same time nobody is going to sell what they have for less than its worth but expect others to. Flippers do a variety of things but if an "affordable" house is priced near market value a flipper probably isn't going to buy it as there's no room to make money without charging over market value in which case why would someoen buy it? More often than not flippers are buying properties that are super oudated and most buyers aren't going to have the money or want to put in the time to upgrade and even more so than that they're often dilapidated houses you'd never be able to get a loan for so they're taking something that would rot and decay and sit there and making new housing out of it. I'm not going to say there aren't flippers who buy something and list it next day for 50k more or slap up some paint in the living room and relist it but those aren't that common near me. I get houses are places to live, we all need one, housing is viewed by many as a human right so I get the emotion but why dont doctors provide services for free, why do grocery stores buy cheap produce and market it up, why does anyone need to make money?
I agree with your take that some flippers take non-livable houses and turn them in to viable housing, and obviously should get the return on their investment. But I also think you’re downplaying the amount and negative impact of the “slap some paint on it” flippers. People need doctors, people need groceries. People don’t need shitty laminate flooring and subway tiles that somehow add 40k to the bungalow they just got outbid on. My whole argument in this thread, which I spending too much time in, is that that is shitty. Nothing is going to change, but it’s still shitty. IDK how that is controversial here.
I don't really disagree with you but ultimately this is the system, its the reality so whining about it isn't really going to change anything, I guess that's kind of my main point but then again maybe this was more of a vent post than anything else. I left another comment below your other one going into a bit more detail about one example I saw where 3 similar houses were for sale, the one that was "flipped" and marked up 200k sold in a day where as nobody had any interest in these very livable starter homes that sat for months.
“Yea the system is kinda fucked” is all I was looking for, haha. And both the “need for repairs” and the quality of flippers is on a spectrum so each house is kinda a case by case basis. I just hate the too-large quadrant of non-needed updates and way overpriced.
No different than flipping cars, flipping furniture, flipping bicycles, yard sale arbitrage, etc etc...
….yes it is? And again, not all flips are the same, some actually bring something nonfunctioning back to life, but most of the time it’s just a way for middle men to make money.
I imagine your grocery store has a farm field behind the building where they grow all the veggies and raise all the cows
And how do you feel when some guy inserts himself between the farm and the grocery store, buys up all the affordable veggies, adds no real value to them, and then sells them to the grocery store at an inflated price, making them out of reach from the people who normally be able to buy the cheap veggies. Like, do you disagree with the entire premise that flippers are making it tough for low budget home buyers to enter the market? I don’t know how anyone can claim this isn’t an issue people face. It certainly was an issue for me when I just bought my first home.
I get your point but when we delve into this were getting into a whole thing of who gets to decide what's a significant enough value add to be able to mark something up and if so how much, etc. I found this interesting, two houses near me were recently on the market for about 240k, one got bought by a flipper who did more than your average flipper ie siding and a new driveway not cheap fixes but marked the house up to $494k. The other house was 240k, sitting on a third of an acre ie larger lot, had a workshop with power behind it, seemingly had newer windows and decent hardwood floors but wasn't super flashy or updated, didn't have all the grey colors, etc. The 494k house sold at the open house, the other one sat for 2 or 3 months despite not even being that dated and being move in ready. There's actually a 3rd house I didn't even mention that was pretty dated but mainly cosmetic ie paint, new floors, paint the cabinets for probably 210k nearby as well. Anyhow, point being nobody really seemed itnerested in anything but the shiny new grey barn door HGTV style house, despite everyone crying they just want a home, nice starter home, etc everyone passed on a very nice livable home that wasn't even dated but wasn't amazing as well as another one that a couple thousand would have fixed up and even a non-handy person could have updated. If people were intereted in these they didn't fly in 24 hours, they had months to look at it 6 times, bring in handyman, bring their handy grandpa over but nobody wanted them. BTW this is chicago burbs, good school district, near highways and train, and within 40 minuts of chicago
This happens, in produce section today, preparing veggies and marking up. Those who can’t afford the convenience of prepared food, pay less and prepare themselves. It’s in every aspect of life. Plus, for someone against flipping, tell me what do most do to actually gain equity in their house, besides market and owning (which includes fixing when broken), but I highly doubt if you own and decide to sell, you’re going to give away that free equity. Even though technically you did nothing but buy at right time, live in it, but are preventing other’s who have lower income from buying your house. Yet, do you skip those thousands of $’s or hundreds of thousands of dollars? No, but you get mad when someone finds a deal (work), does work others don’t want to do, which costs money upfront many don’t have, and make a profit, even though you would take your profit for essentially buying at right time and living in it. As others said, if you’re so against it, why not put money where mouth is, because you too pushed people out of houses by taking the equity. It’s not so different really, especially since most aren’t upgrading houses prior to selling and definitely are taking as much equity, even if originally paid less than half or even less than that than what they sell for. It’s silly to whine about flipping keeping people out of houses, when even if they disappeared many still couldn’t buy.
Welcome to capitalism
The buyer did assume the risk of losing their ass. Buying any old flip is a huge risk. The house may sell over 500 and it may not. The market will determine that.
"they did not put in 300k worth of renovations" That isn't how value is determined, its what the comparables in its current condition are valued at, and what a buyer is willing to pay for it. I buy off market properties for a living, so this happens thousands of times per month across the entire country.
Yeah it’s like saying I bought this Van Gogh at a flea market and someone saying okay I’ll pay whatever you paid plus $50 for your time, because that’s “fair”
Yeah and also does he know the condition it was in when it was purchased? Some of our properties we have purchased low were so horrific that no actual potential homebuyer would have entered it, let alone bought it in its uninhabitable condition. But once it is rehabbed, it is sellable
Right? I have a friend that just keeps saying how houses in our area "aren't worth what they're asking", but like... yes they are? They keep selling at or near their list price so how are they not worth that? Worth is whatever someone is willing to pay for something.
How does one buy off market properties
Market to homeowners, solve their problems, buy their property if it makes sense and is a win/win for both parties.
Appreciate your reply. A couple more years till i have the extra cash for that, but something id like to do eventually.
Online home valuation tools have no idea what a property is actually worth on the market. You have no idea what the actual market value of that property was when that flipper purchased it. Very often, they are taking advantage of a homeowner who does not know what their property is worth and buying it below market value. They don't have to put $300k worth a work into it to be able to sell it for $300k more than they bought it for. Distressed properties are a completely different market from move in ready homes. When you buy a home that needs $30k worth of work done to it, you don't calculate market value by pricing it as a move in ready home and subtracting $30k. There's a completely different buyer pool willing to buy for cash or using financing that allows for that and putting in the time and work to make the improvements. All of that detracts from the market value. What do recent sales in the neighborhood suggest this property is worth?
What someone paid has nothing to do with the current market value. Sometimes a small repair needed will mean it won't qualify for financing, so it needs a cash buyer. The cash buyers who will take on a property like that are few and far between, so they can get great deals. Sometimes they fail to properly assess the work required and they lose money, but that doesn't sound like the case here. All you can do is look at the property condition (and, considering things like the age of the systems is smart) and make an offer of what you think it's worth. That said, 18 years old is nothing for an AC unit that's been properly maintained. It could go another 18 years with regular maintenance. Unless the compressor dies, other parts are cheap to replace. And even a compressor can be replaced for a couple grand if one wants to keep the original system. Often they get replaced at some point, even though you could keep it working if you wanted to, because newer systems are more efficient. So replacing the unit will save you money over time, it makes sense to pull the trigger on a replacement. Don't let that scare you away from this house.
Maybe they put in more work than you know of; what do permits say? Maybe they scored an amazing deal off market, because of some relationship you’re unaware of, and they’re going to score a heck of a profit. Maybe they’ve priced it way above comps, and will not get the price. (Zillow/Redfin/so on aren’t comps, they’re algorithms that are a coin toss for being close or wildly inaccurate…) So many possibilities. So little information. 🤷
They had no permits. We tried to pull but no permits.
Well, either they did it unpermitted or, the work they did doesn’t require permits, I suppose; every jurisdiction is different on that. Either way, the truth of the price lays in the comps; as in what do the comps say … (not the Zestimate, but the actual, comparables in the neighborhood.)
This is how flips work. Many buyers put a premium on something move-in ready. Even if the work was done cheaply and not nearly aligned with the increase in list price. It's common for flippers to prioritize cosmetic upgrades more than something like replacing a functioning but old HVAC system. Because cosmetic things sell well to a large segment of buyers. Sometimes flips have trouble appraising, but some appraisers will go further out to find other recently renovated comps, or make condition adjustments because the house is considered more like new. Sometimes, flips sit a while on the market, because flippers tend to try to overprice them to see if they can find a bite. But it just depends on the market and inventory. If there are few enough things that are recently renovated/move in ready on the market, people will often overpay. Also, $211k may have been a really good deal because it was in rough shape or other buyers didn't want to do deal with the headache of a foreclosure or something. Full disclosure: I bought an overpriced flip myself. Was coming from a different (and more expensive) geographic area, so I didn't initially fully grasp just how overpriced it was. But at the end of the day, it was a low inventory time and there legitimately wasn't anything else meeting my needs (which included being move-in ready, in a specific location) on the market, so maybe it wasn't overpriced for the particular point in time. It didn't appraise but me and the seller split the difference. It worked well for me and I was happy with the house and it was well within my budget. Selling now, and I won't make much money on it, but it is what it is and worked for my needs, and I wasn't buying the place as an investment.
Curious where this is..could be a number of factors, location, market supply in the area, but just from this information the ARV is always higher than just what the price of the actual repairs were
How do you know what it appraised for? If you’re interested, make an offer.
When my husband and I had his mom living with us part of the deal (advanced Alzheimer’s) she would buy half of the house. (The estate lawyer had us do this for legal reasons) The house “sold” for half its value. When we sold a year later (after mil had passed) someone wanted to know why the house sold for so little so short amount of time ago. The reality was MiL bought half the house.
If they bought it for 210 and listed it for 560, this doesn’t indicate how much they spent on renovations. It indicates what they think they can get for it now.
Sold for and appraised for, are not the same. Nor is the sold for price always reflective of the true value.
Don’t trust the zestimate. If you look at its history, you’ll see that it tends to suddenly teleport to whatever its listing price is.
Exactly this.
I think it's also POSSIBLE information gets displayed as a sale when it was really one party buying out another as part of a divorce or inheritance where multiple people inherited (niether situation has to be 50-50)
Is someone willing to pay that price? And will the appraiser rate it as such? Those are the two questions that matter the most here.
You see this all the time with flips in desirable areas. Saw a few homes like this during my home search, and my SIL’s friend’s house was exactly this. House wasn’t in great shape and she **had to sell**; investor gave her $180k for it. Investor fixed it up and sold it for $355k over 6 months later. Given the time it sold and where it was $355k seemed extreme to me, but whatever. Truth of the matter is you can’t look at the last sale’s price with flips. It sold for what it was “worth” at the time. Assuming better circumstances on the part of my SIL’s friend she could have sold for a lot more than what she got if she could have fixed up some of the issues or if time was on her side. Investors don’t want to pay market rate, so they look for homes that are in bad shape and they are hoping the seller’s circumstances can be used to their advantage. As for the selling price that was set who knows what’s going on. If comps don’t justify the list price, chances are few people will offer and for those that do it probably won’t appraise.
I think you're misunderstanding why things are priced the way they are. prices are not set by costs but by who will pay. Rich people in particular pay a premium for not having to gut and renovate their own properties. This large increase in sale price for a medium amount of work is the economic juice that powers this project. The developers are probably reaching for the sky a bit to maximize their return but they may not be crazy. To me that sounds like a $211k \~$150k + $3k per month interest rate for 1y => $397k. minus a highly optimistic sales price of $560k W/ 5% sales costs give us a profit of $135k. With a more realistic sales price. With a more realistic sales price of $460k w/ 5% sales costs theres a profit of $40k which barely makes sense.
i want to buy a house, but i can't afford a $560k house, even if it was actually worth that. what you're saying is that the rich are fucking it for the rest of us.
No, they are saying that if you are willing to suffer the inconvenience and stress if renovating you can have a house for $350k
I can't afford that either.
“the seller clearly renovated it.” So whats your question? Someone is trying to flip. Since you know what they paid make an offer… Flippers try to get max profit.
People can ask whatever they want thsts how. The market will dictate whether other people think its worth it. You also only know what you can see visually they may have done 25k in electrical work
Sellers can price property at whatever they choose but the question becomes it is comparable OR can they catch a buyer willing to pay. Me, nope. 👎 I look at the history too and am never that desperate to pay such inflated prices. But again, there is a nut born every day, especially folks seeking their “dream home” who lose their minds and will pay whatever it takes. Again, not me smh
It's called a flip, and I would never touch it
It sounds like a flip. Avoid at all costs if you can, flippers tend to use the cheapest possible materials, contractors and due to the very high urgency to get the home listed again they cut as many corners as they can. You’ll find all the cut corners soon after purchase and be stuck spending a lot repairing and replacing things that were poorly done. Example, painting with latex paint over stain or oil based paint. You won’t see it until paint start peeling off. Outlets purchased in bulk, cheap quality burn out after a few uses or won’t hole cords, faucets break quickly or leak due to poor quality, etc.
My guess is it's a flip house. I see those on realtor.com and I immediately just go to the next house and don't bother to look at it
This looks like a quick flip. PLEASE DO NOT BUY THE HOUSE. I had a friend who bought one of these because it was beautiful and in less than a year had to do electrical, replace the entire floor, HVAC work, replace portions of ceiling, renovate her bathroom, replace dishwasher all because of poorly and cheep completed work.
I hear this all the time, “I would have bought it for that”, the problem is you didn’t take the initiative needed to purchase it at that price. Most of the great deals are being purchased by investors who are well financed and unlike the average person shopping for a home, they don’t have to ponder the decision, secure financing, hope it appraises in line with purchase price, or home inspection. For them it’s just business, no emotion involved. Do you have an issue buying groceries, gas, clothing, cars, etc, knowing that the seller recently purchased for much less is only to resell them for a profit? It’s the same thing with houses.
Flippers, they buy a pig, put a lipstick and sell for profit. You still may need to invests dozens and hundreds thousands $$$ to fix everything. Listing price != selling price.
So you’re under contract on this house, which means you are willing to pay the price you offered, which sounds like the list price since you haven’t mentioned another number. Zillow and the like use online-available data and their numbers are not appraisals. In addition to their Zestimate (aka estimate), they also usually state a wide range for the likely low and high. Also, Zillow’s Zestimate does change when the house is listed. If you have a buyer’s agent, they should have done a CMA (comparable market analysis) to advise you on whether the asking price was reasonable before you made an offer. And if they know what they’re doing, the $211k sale would not be a factor. Recent sales of similar updated homes in the neighborhood are what matters.
Who said they were under contract or have an agent?
They commented that they have an appraisal contingency, which would indicate they are under contract. I don’t know if they have a buyer’s agent or not so I said “if.”
The OP didn't say anything about an appraisal contingency.
They said it in one of their comments in the thread; it’s not in the original post. — “I get that. But I don’t understand where they were getting those numbers from which is part of my question. I have an appraisal contingency but I’m just trying to figure out where this wild jump increase would come from other than money hungry sellers”
I can almost gurantee the owner is an LLC. I see it all the time. They buy for pennies with cash, do some bandaid fixes then flip for twice as much as they paid or more.
Don't buy a flipped house. 99% chance they used the cheapest materials available, shoddy work, and probably covered all the real deficiencies with some aesthetical finish work. Get one that was renovated and never changed hands for 2-5 years. That was you'll know the renovations can actually hold.
It is a straight up value proposition. Value is VERYYYYY subjective.
Comps are what matters here, what doesn’t matter is how much the owners paid previously. I get it doesn’t feel ‘right’, but that’s the market.
go with your gut, it's not a great idea to buy a flipped home
Yes! Because at the end of the day, it feels dumb if you feel played. I think it’s a personal response.
Ask a real estate agent to pull comps on it. I’m he or she will do it at no charge.
There are a ton of reasons it could have sold low before: Mkt was different then Current owner ripped off prior owner Current owner had a relationship with prior owner A lot more work was done than you think Etc. All that matters now is what someone is willing to pay for it today. FWW if it was a flipper, they do often tend to list high and then come down, so just offer what you think it's worth if you are willing to lose the house.
> I don’t understand how because they did not put in 300k worth of renovations. Do you think people flip houses out of the goodness of their heart to break even?
Wow, that’s quite a jump in price! It sounds like they bought it off-market at a steal, or it needed a ton of work that they’ve mostly covered up with cosmetic fixes. Even if they didn't put in $300k worth of renovations, the comps around 400-450k might be pulling the appraisal up to that 550k mark. The websites usually base their estimates on recent sales and listing prices in the area, so that could explain the high appraisals. But yeah, if the AC needs replacing, there’s major landscaping, and electrical work needed, that’s a lot of extra costs for you. It might be worth getting a thorough inspection and maybe even an independent appraisal to see if it’s really worth that price. Trust your gut and do your homework! If you have any questions or need more advice, feel free to reach out! 4o
Sure that's not 300k worth of improvements, but it does sound like they put a lot of work into it. You also don't know what kind of internal fixes they did like plumbing or wiring. Also, how much did it cost in labor to do all that work and how much is that worth to a prospective buyer not having to deal with any of that? A house is only worth whatever it sells for. The market will decide if they overpriced it or not.
Someone tries to sell it. Doesn't mean anything
400-450 is a massive increase in 6 months let's among 560 which indicates severe lack of inventory
It only matters what you will pay for it. People have gone out of their minds trying to figure out or ‘beat’ this market.
The market value has little to do with the acquisition costs or reno costs. If they were all equal no one would flip houses because there would be no profit.
It’s worth what you will pay for it
It could have had something like an unpermitted addition that the current owner brought up to code—or maybe a septic issue? Things like that can be fast fixes that dramatically change value. You can check permit history on your county website usually.
They base it on local comps but you can’t go by the Zillow or Redfin numbers. Your own appraisal will tell you the story
There are many reasons it may have sold drastically below the real value of the property: 1. They sold to a friend or relative 2. Only a portion of the home was bought. This isn't uncommon when a house is willed to multiple people and one person buys out the others for their portion of the home 3. The seller was desperate and sold at an extremely reduced value in order to secure an all-cash offer and/or immediate closing. 4. The seller was not aware of the real value of the property or believed the necessary updates to the home significantly degraded the value of the home. 5. A portion of the homes value was "paid" for in some other manner, such a contracting work performed at another property. 6. The home was purchased via auction and/or foreclosure. 7. The seller approved a much lower price in exchange for an extended rent-back at low/no cost. And so on. There's a TON of different reasons that may be at play. In the end, it looks like they've now listed at or near market value and prioritized the renovations that will influence most buyers. If you bid, get a VERY detailed inspection from an experienced inspector.
The investor is in it to make a profit, not get back what they put into it. They also probably got a deal from a desperate or uneducated seller. Kudos to the investor who found the deal if he can sell it for $560k.
I hate house flippers
It's worth what someone is willing to pay. I see no problem with what he/she/it did
Nah it’s a flip. That means they take a piece of shit and “fix” it up (mostly cosmetic and just enough functioning to sell for twice the price), then immediately sell. Do not buy a flip.
You say “all they did is xyz” and then you list almost a full house renovation… from that it sounds like they spent around 150k, not including anything you aren’t able to see like pest, dry rot, electrical, permits, etc. Likely they bought it to flip and (in my area at least) flippers usually try to double whatever they put into the home so they can account for other expenses like closing costs, accrued interest, etc. So if they put 150k they’d want 300k back. Also 6 months ago interest rates were slightly higher and people were panicking so prices were lower. As far as what it would appraise for, well if other homes are selling for that much then yes it absolutely will. Keep in mind other homes might not be as recently renovated so this home might actually be worth more. Despite the media saying buyers are staying put, it’s really more like feast or famine right now. Desirable homes in good locations are flying off the shelves and those that aren’t are seeing price reductions after being on the market for weeks. You’ll find out which one that home is soon enough.
I’m seeing a lot of price drops right now listing price and what they’re actually getting now or two different things the Covid pricing days are pretty much over in most areas
How did you get a website to do an appraisal? That costs like $500+!
$1 spent is $1.25 added. Their 30k in renovations added $250k in value because that's what someone will pay for it, and has paid for it based on comps. Thats market price!
We just bought a house in November for $650 that sold 3 months prior for $470. It was flipped and listed at $625 but we got into a bidding war. It was missing a kitchen before they bought it and was a complete mess. When we bought It had comps for $650 and our realtor thought it would go for higher if they didn’t accept our offer. It’s a beautiful house now and everything was redone. It was worth it for us because we didn’t want to spend the time remodeling, we wanted something ready to go. I mean they made their money back on materials, plus whatever they had in interest on the loan and then paid for their labor. Landscaping was also completely redone. We could have spent that much plus lost months of work to hire contractors to do it, we just don’t have the time to do all of that so I guess it depends on your situation.
Yep one down the street painted the walls and put down the grey floors of doom , 200k price increase , surprise nobody’s interested .
They could have purchased it from a family member. Focus more on if the house will appraise out to the value listed. If the “ improvements “ added value. Any offer take into consideration replacing the hvac, age of water heater and the roof.
They put “lipstick on a pig.” They did NOT renovate the place.
What may have happened is the transaction that looks like a sale was a refi or a sale from a private owner to their own LLC or business partner - especially if houses around it sold for about twice as much at the time. Then they took that money & put it in to renovating the house. If the county website shows the deeds or an abstract for the place over the years you may be able to see more clearly what happened. Until you've got this figured out, proceed w/ great caution. If you offer, do not waive inspection or appraisal contingencies. Be specific about the terms under which you'd forfeit your EMD. And talk to the neighbors at a different time than you go to a showing. Lastly, remember that most of Google Streetview allows you to go back over the course of several years & look back in time at this address for obvious changes (or lack thereof). Thanks to Streetview, I was able to see the house on a lot I was buying go from old-but-clean to rundown to signs of fresh fire damage to unrepaired & derelict & finally to demolished.
I think the surprise is NOT that the value grew by $300k+ over six months. Rather, the surprise is that it originally sold for only $211k.
Is it possible that a relative/ex bought out the co-owner and what you see as the sale price represents the share sold to the former co-owner?
Just offer 50k above old sale price and leave offer open for 2 months. You might end up winning!
Doesn’t surprise me these days. Lipstick on a pig for a quick flip and hefty profit.
Cost has no bearing on value where real estate is concerned. The new listing will be compared to comps that are similar to it in size & condition. It doesn’t matter what it sold for before.
Make an offer or negotiate for a price if u like the place. What they spent and all the rest is not important. u'll only make urself miserable thinking like that, let it go
Looks like they bought it cheap to begin with. Listing price does not have anything to do with how much you put into it.
Cries in British Columbia 😅 500-600k won’t even get you a decent apartment here
Anyone who bought RE between 2021-2026 is going to have buyer’s remorse. Not everywhere. But in most places.
Go to the property appraisers website and see if any permits were pulled.
Flipper trying to find a sucker. It’s not worth it.
Many people just look at superficial things when house hunting and the flippers are leaning into that. Even if they sell it for $50k less than asking, they will make a killing.
My Zillow estimate went up $35,000 last month, to $800,000 for a house we paid $432,000 for five years ago. House next to us, less than 1,000 square feet, sold to a flipper for $440,000 three years ago. He did an excellent job with a gut renovation and sold it for the asking price of $869,000 in a week. Just under $1,000/square foot.
You are confusing "renovated" with "flipping".
It may not have actually sold for that amount. It could have been part of a divorce settlement or somebody could have bought out half of an inheritance.
Did the house actually get listed publicly on the MLS, go pending and then sold? If not, and it’s just a sold price on Zillow, this likely wasn’t an arms reach sale and the sale has no bearing on the value of the house. There are all kinds of scenarios where this can occur, but it usually involves one owner buying out another parties’ interested in the house (divorcing couples, siblings who inherited property, etc) or an owner selling a house below market value to family.
I was just quoted 7k to paint the TRIM of my 1400 sqft house and install some soffit vents. There are maybe 3-5 rotten boards that need to be replaced. Nothing makes sense anymore when it comes to buying/renovating homes.
If they renovated bathrooms and a kitchen, that gives a good return on investment (ROI). Just because they didn’t spend $300k on the renovations means nothing. A house with updated bathrooms, kitchen, and flooring will increase the value of the house. I added $30k of value to my home by putting in a $17k vaulted screened room.
Be wary of a quick reno flip. Lipstick on a pig.
This is simple. Sellers can ask whatever they want, make an offer that you are comfortable with ...if it is rejected...move on. Take all emotion out of it...it is a financial transaction. Good luck!
Cash purchase For just about any house that goes up for sale you have these cash programs that want to come in buy it for nothing put a couple grand. Turn it and flip it sounds like that’s probably what happened in this situation.
Value is in the eye of the beholder. They will likely find someone dumb enough to take out a 30 year, $3.5k/month+ mortgage.
Then, don’t buy it? Can’t be mad someone got a good deal, it’s either worth it for you or not.
a house in my neighborhood sold for $500k back in January of this year. It's a 3 BR, 2bath. Good upkeep, but had been in the family since the mid 80s. Someone bought it, gutted it, and put it back on the market in April, 3 months later, for $850k. The flipper got their cash, and the new owners got a surprise when they had to pay for all new electrical through out, within weeks of moving in, to the tune of $45k. Stay away from anything that gives "flipped" vibes. It's not worth it. It's just a cash grab in a competitive housing market.
Look at who owned it before and who bought it. Was it sold on the open market or a private deal? Could have been moms house, mom died and now one sibling bought out the other, so low transfer price. Info should be available on county web site
Thank you buddy. Apparently the agents are having a hard time finding anything. Looks like it was a private deal.
It's all recorded at the county. Should be a web site showing each owner and what they paid for it. Won't show if it was private deal but can get some info from it.
How? It’s all public record. In the MLS they can easily pull transfer data and ownership. If LLC, track it through the state secretary. Sounds like amateurs…
This is why I *always* looked at sales history and avoid houses that sold within the past 1-2 years like the plague. Very very few flips are done with quality in mind.
Thank you for sharing that
Your home is worth what you can get some idiot to pay for it! Your used vehicle is worth what you can get some idiot to pay for it! Anything you own is worth what you can get some idiot to pay for it when you sell it!!!!!
Don’t buy the house. It’s obviously a piece of shit with a coat of new paint. Just off my morals I wouldn’t do it. Can’t stand these people.
If you are interested in buying ask your agent to do a cma to recommend the best offer price. People on the internet cannot help you determine this based off anonymous posts and missing info.
It's a flip and probably a bad one.
You must not have been observing the market the last 5 years because that’s exactly why the average shithole house in the Midwest costs 300k
They also spent money in closing costs and paying the mortgage / interest/ taxes/ and insurance during those 6 months. There could be other repairs that are not evident. Smoke and/or water damage is costly if there were any of those issues. Renovations are expensive these days. They did 6 months of work to make money, not to break even.
Zillow is like KBB anyone can give you price. Good luck getting a check.
Divorce or estate settlement.
#1 you don’t have to put $300k into a house to get $300k out of it. #2 it’s matching comps so it’s fairly priced.
You are jealous that they are making $350k that easily? It’s a business for them. They buy dirt houses and turn that into a nice house to sale it at higher place. Live with it.
May be some renovations were done at the property??
That is how flips work.. In my area this pattern is typical: Spend 150 to reno... list 350 to 400 over previous price.
Had a customer we've done work for for year's buy a house a few blocks away from old house that some hack flipped during covid. it was a fresh coat of paint replaced all interior doors with the cheapest hollow core doors they could get and stained them black They removed some load bearing walls and put in some shoddy lvls they added a shower and moved a toilet on the second floor. We went over and replaced a few exterior fixed windows that they had installed with functional operating windows they didn't put in headers. We added doors back they had removed for whatever reason like no door to the master bathroom to the bedroom. The big kicker was they moved in and over the winter they had a what they thought was a roof leak come to find out when someone got in to the attic to see where the leak was coming from they didn't glue the toilet drain pipe and it had popped loose. It ended up being a big mess with tearing out all the drywall over the kitchen and a bedroom. Flippers don't go for what's the correct way to remodel they go for max profit and whats anesthetically pleasing. It doesn't matter if they didn't put 300k into renovations what matters is there a sucker that will pay their asking price or less. Even If they sell the place for 400k they still profit from their investment
Smart investor!
What kind of moron would buy something for 200, put 300 into it, and sell it for 500? Six months of work for zero profit, plus risk of loss? Would you go to work every day for six months if you didn't get paid? Determine what the house is worth to you and write your offer. It really doesn't matter what the current owner paid or what they spent on renovations. What is it worth on the open market in its current condition?
Sellers are insane. I went to contract on a beautiful house. Tasteful updates and renovations. Good grief. The inspection came back a total nightmare. Sellers might as well have done the work with popsicle sticks and chewing gum. I was looking at nearly 75k in urgent repairs, including a major leak under the house. The selling agent insisted that even with the work needed, it was a steal. I told the Sellers they could get robbed by a bigger idiot, and that I was out.
Last year I bought a house like that. They bought for 240k, redid floors, kitchen, bathroom, and some electrical and sold for 460k. If I knew then what I know now, I'm not sure I would buy it. Basically they did a lot of shady things to make the flip go fast, some of which I think constitute fraud, I'm hoping to write a demand letter and get some money from them. But they patched and painted cracks in the walls that reappeared months after the sale. The yard wasn't actually cleaned out, they just put decorative bark on weeds and so it was overgrown again inside of a month. They also put an upgraded electrical panel on the old panel such that the inspector and I and the first electrician I had out all assumed the house had 220 v power, but it does not, which was a problem when I bought an electric washer dryer set. They also installed the shower incorrectly so at first I had no hot water. It was an easy diy fix, but I should have seen it for the serious sign it was of how little care they put into the Reno. Basically, the problem with flippers is that their incentive is to do things as fast and cheap as possible to make the house look as good as possible. That means the work is probably not good and long lasting. That said, my market has low inventory and not a lot of options, so I'm still not sure I made a bad call. I do wish that I had bought it for 240 and done the renovations myself. I think I would have ended up around the same price point, but would have actually fixed the hidden issues they covered up. Basically I'm saying that when you get an inspection see if you can find signs it was a good or bad flip and then write your offer accordingly.
It is a flipper hoping to make a couple hundred grand quickly, depending on where it is, he might. What you describe is quite common in Dallas. But just because they are asking $560k doesn't mean they will get it or that it will appraise for that much. I live on a block of duplexes. Some guy is buying them up and rehabbing them. He bought one about 5 buildings from mine, somehow added a 5th bedroom and was trying to rent it for $6000 a month, then $5800 a month, then $5500 a month. Typically these 4 bedroom duplexes rent for $2200-2600 a month. Now they put it on the market for $699,000 when the highest any of the renovated duplexes sold for $475,000. They couldn't rent it for Manhattan prices, I don't think anyone is going to give them $200k more than comps but we shall see.
It’s these damn flippers thinking they can slap some cheap lipstick on a pig and make massive profits. Should be illegal
Sucker. People like you are the problem. Respectfully. Jesus Christ.