Investing in Real Estate Part 3
October 5, 2019
Good morning everyone! I wanted to write today about the outcome of my last two blogs on my two flat negotiations. Unfortunately, (for them) I declined the offer. So back to square one.
In my last blog I left off on us getting the inspection on the property and there being a lot of issues. I will get a little more detailed as someone messaged me asking questions about my last blog. The property was listed at $339k and we offered $325k with 3% closing credits and the seller agreed to this price. Then we had the inspection and asked for a $20k credit or to reduce the list price down to $310k and she declined our offer. Before I go on, yes, I understand that $20k is a lot to ask for credit and yes asking to lower the price by $20k is also asking a lot but I am an investor and my numbers showed me in order to make a profit that I would have to lower to those numbers which is how I came up with the numbers in the first place.
Once the seller declined our offer, I was quite disappointed, I am not going to lie. I wanted this place but at the same time, the numbers do not lie. Additionally, I had a hunch that they were "playing hard to get" and bluffing. The sellers attorney was extremely rude and pushy in her emails which was actually a huge turn off for me and I didn't understand why there was so much hostility over a property. When we countered she replied with a "NO. Absolutely not!" and almost telling us we were crazy despite our reasoning.
We had two different people look at our inspection report who both confirmed it would be approximately $20-30k in repairs so this not only confirmed my counter offer but it made me feel good about my counter offer, even though I had a feeling it would be rejected. Funny turn of events, the seller then started texting my realtor and she was going back and forth saying that the property is in solid condition (lie) and that she wants to get it sold so she was open to negotiating. Negotiating for her meant us raising the price to appease her and her not being willing to lower it at all, um no. After tons of back and forth, the seller finally agreed to fix the freakin roof!! Amazing huh?!
All this back and forth and had she just agreed in the beginning instead of playing the head games, we would definitely still be under contract getting ready to close in a month. I mentioned in Investing in Real Estate Part 1 how I hate game playing and it turns me off. I have a saying I like to go by "say what you mean and mean what you say." You can't be wishy washy and not expect to turn people off, especially when it comes to negotiations. I was intrigued because now her fixing the roof changes the dynamic of the deal. Now I don't have to come out of pocket for that big expense so it did make the numbers look a little better.
I began thinking about this deal even though I was already turned off by all the flip flopping by the seller. Then I spoke with a coworker about the situation and she advised me that I probably should not buy right now as a recession is coming. Of course, no one knows when a recession will actually hit but there are all types signs that show when one is coming. When she told me this, the light bulb went off in my head and I realized she was right. It explains why all the places we saw were priced so high, the market is at its high point currently. And it also explains why we saw so many properties priced high that were crap. I decided to sleep on it and when I woke up in the morning, I woke up to screenshot of the sellers message about fixing the roof and her being rude (again) and saying she was not going to spend over a certain amount to get it fixed. At this point, I had been turned off enough to say forget it. I told the realtor to tell her the deal was done and I signed the contract cancellation with my attorney.
I am a little disappointed that it didn't go as planned but I do not regret my decision. I know I made a good choice. One of my strengths as a person is my intuition. Boy is my women's intuition on point! I get these feelings inside and they are usually right. No regerts, im mean regrets ;-)
Another funny turn of events was yesterday, when I received another message from my realtor that the listing agent for one of the places we had put an offer in for contacted him saying that the seller is motivated and she would like to reconsider our offer. If you read part one and two of my Investing in Real Estate blogs, I called this! All the places we put offers in on ARE STILL ON THE MARKET. And they are going to end up being on the market all winter long hence having to lower their prices even more! SO, I am going to be patient and wait it out and see what pops up in the winter as well as seeing if the places we had put offers in on lower their prices again.
Strategy people! Patience is a virtue, especially when you are putting up thousands of hard earned dollars on an investment which is why I was really careful about this deal that fell through. I am not rich and I have worked really hard for my money and I save all profits from my investments to reinvest them into other investments. So if I make a bad choice, all my hard earned money can go to crap and I would be absolutely devastated if that happened. So be careful, be diligent, do your research, and don't let people bully you, lie to you, and pressure you into a deal.
Before I go, I appreciate the feedback and questions on my blogs. Comments, questions, and suggestions help me understand what content my readers are looking for and what to leave in and keep out of blogs, so thank you for taking time to write to me. Much appreciated! Until next time loves!
Good morning everyone! I wanted to write today about the outcome of my last two blogs on my two flat negotiations. Unfortunately, (for them) I declined the offer. So back to square one.
In my last blog I left off on us getting the inspection on the property and there being a lot of issues. I will get a little more detailed as someone messaged me asking questions about my last blog. The property was listed at $339k and we offered $325k with 3% closing credits and the seller agreed to this price. Then we had the inspection and asked for a $20k credit or to reduce the list price down to $310k and she declined our offer. Before I go on, yes, I understand that $20k is a lot to ask for credit and yes asking to lower the price by $20k is also asking a lot but I am an investor and my numbers showed me in order to make a profit that I would have to lower to those numbers which is how I came up with the numbers in the first place.
Once the seller declined our offer, I was quite disappointed, I am not going to lie. I wanted this place but at the same time, the numbers do not lie. Additionally, I had a hunch that they were "playing hard to get" and bluffing. The sellers attorney was extremely rude and pushy in her emails which was actually a huge turn off for me and I didn't understand why there was so much hostility over a property. When we countered she replied with a "NO. Absolutely not!" and almost telling us we were crazy despite our reasoning.
We had two different people look at our inspection report who both confirmed it would be approximately $20-30k in repairs so this not only confirmed my counter offer but it made me feel good about my counter offer, even though I had a feeling it would be rejected. Funny turn of events, the seller then started texting my realtor and she was going back and forth saying that the property is in solid condition (lie) and that she wants to get it sold so she was open to negotiating. Negotiating for her meant us raising the price to appease her and her not being willing to lower it at all, um no. After tons of back and forth, the seller finally agreed to fix the freakin roof!! Amazing huh?!
All this back and forth and had she just agreed in the beginning instead of playing the head games, we would definitely still be under contract getting ready to close in a month. I mentioned in Investing in Real Estate Part 1 how I hate game playing and it turns me off. I have a saying I like to go by "say what you mean and mean what you say." You can't be wishy washy and not expect to turn people off, especially when it comes to negotiations. I was intrigued because now her fixing the roof changes the dynamic of the deal. Now I don't have to come out of pocket for that big expense so it did make the numbers look a little better.
I began thinking about this deal even though I was already turned off by all the flip flopping by the seller. Then I spoke with a coworker about the situation and she advised me that I probably should not buy right now as a recession is coming. Of course, no one knows when a recession will actually hit but there are all types signs that show when one is coming. When she told me this, the light bulb went off in my head and I realized she was right. It explains why all the places we saw were priced so high, the market is at its high point currently. And it also explains why we saw so many properties priced high that were crap. I decided to sleep on it and when I woke up in the morning, I woke up to screenshot of the sellers message about fixing the roof and her being rude (again) and saying she was not going to spend over a certain amount to get it fixed. At this point, I had been turned off enough to say forget it. I told the realtor to tell her the deal was done and I signed the contract cancellation with my attorney.
I am a little disappointed that it didn't go as planned but I do not regret my decision. I know I made a good choice. One of my strengths as a person is my intuition. Boy is my women's intuition on point! I get these feelings inside and they are usually right. No regerts, im mean regrets ;-)
Another funny turn of events was yesterday, when I received another message from my realtor that the listing agent for one of the places we had put an offer in for contacted him saying that the seller is motivated and she would like to reconsider our offer. If you read part one and two of my Investing in Real Estate blogs, I called this! All the places we put offers in on ARE STILL ON THE MARKET. And they are going to end up being on the market all winter long hence having to lower their prices even more! SO, I am going to be patient and wait it out and see what pops up in the winter as well as seeing if the places we had put offers in on lower their prices again.
Strategy people! Patience is a virtue, especially when you are putting up thousands of hard earned dollars on an investment which is why I was really careful about this deal that fell through. I am not rich and I have worked really hard for my money and I save all profits from my investments to reinvest them into other investments. So if I make a bad choice, all my hard earned money can go to crap and I would be absolutely devastated if that happened. So be careful, be diligent, do your research, and don't let people bully you, lie to you, and pressure you into a deal.
Before I go, I appreciate the feedback and questions on my blogs. Comments, questions, and suggestions help me understand what content my readers are looking for and what to leave in and keep out of blogs, so thank you for taking time to write to me. Much appreciated! Until next time loves!