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Now, here’s what you need to know when it comes to negotiating a real estate deal.
As an Epic real estate investor, your goal is to get a signed contract with the seller as quickly as possible in order to beat your competition. After all, the longer the process takes, the more competitors you’ll have sniffing around. By instilling urgency into your process and moving quickly with your offer, you get control of the deal, locking out your competition.
And don’t let the ‘quickly’ part of this process concern you. A lot of investors make the mistake of taking their time before making an offer. They like to do their inspections, analyze the neighbourhood and the condition of the property, and they take time crunching the numbers.
Don’t fall into this trap! Your greatest asset when negotiating real estate deals should be your speed. All you need to do is make an offer somewhere in the ballpark price range, then present it to the seller, contingent on your inspection.
That way, by adding contingency clauses to the purchase agreement, you retain the legal right to inspect the property prior to closing. Should you discover anything during the inspection that negatively impacts the value of the property you’ll be able to renegotiate the price or walk away from the deal without penalty.
Now, let’s talk about your quick and dirty math. How do you calculate your ballpark offer?
The formula I use is:
👉 (ARV x 70%) – repairs – profit = your maximum allowable offer
You can adjust this percentage depending on the value of the property.
As far as calculating repair costs, I base my calculations on:
Light repairs – $10 per square foot
Medium repairs – $15 per square foot
Heavy repairs – $20+ per square foot
As for your profit calculations, well that’s for you to decide🎉
As a general rule I bump it up a little bit just to leave some room for later negotiations (either with the seller or a buyer later on). I also cover my bases by making sure, if I’m left with the property, the monthly gross rent is going to be greater than 1% of the acquisition and repair cost.
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Now, this should give you a great starting point for how to negotiate a real estate deal but it can get much more sophisticated than this. If you’d like to download 10 more examples of creative deal structures – the same ones that I give to my private clients – you can download them free at http://epicbreakthrough.com
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Want to get in on the secret sauce to negotiating cheap real estate deals for yourself? Learn how to create a win/win deal with motivated sellers with these negotiation secrets!
⏯ How to Negotiate a Real Estate Deal Playlist ⤵
🚦Individual Sessions:
▶ Deal: Intention is Everything 👉 https://youtu.be/QP_N08rbKF4
▶ Accurate Property Value (Get it RIGHT!) 👉 https://youtu.be/_Aa0BpwSte4
▶ Price and Terms (Creative Financing) 👉 https://youtu.be/70pzUb_rA_Q
▶ Lead Conversion (the RIGHT way) 👉 https://youtu.be/qNZkI4jmPs8
▶ How to WIN Every Time! 👉 https://youtu.be/rW7UEGboJ30
▶ Conversational Conversion Process 👉 https://youtu.be/8b3Zeq-5uSo
▶ The Right Way to Follow Up (FORTUNES!) 👉 https://youtu.be/xCMb6aQqv5s
⏯ CREATIVE REAL ESTATE INVESTING FOR BEGINNERS ⤵
http://CreativeFinancing.us
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My name is Matt Theriault. When aspiring, frustrated investors are stuck in the proverbial “rat race,” they come to me.
I help these people create passive income through creative real estate investing strategies so their money works harder for them than they do for it, resulting in ultimate financial independence and freedom.
Whenever you’re ready, here are some ways I can help…
If you’d like…
✅ to brainstorm some ideas about your real estate investing and the potential of working together, watch this https://youtu.be/JQPTe2XzDVM
✅ to find off-market deals, regardless of market conditions, watch this https://youtu.be/nlRY5hw71iY
✅ to know how to present a deeply discounted offer to a seller so that they happily sign your contract, watch this https://youtu.be/CaAIuXKnN_M
✅ to learn the best way to make money investing in real estate next year, watch this https://youtu.be/nRdZ4kinmio
✅ a simple easy-to-follow “game plan” that pulls it all together, watch this https://youtu.be/cPGzti2jDfc
💰 to get quick access to $50K to $150K for your next real estate deal, you can at http://epicfastfunding.com
🔥 to Go FASTER in Your REI Business, watch this https://youtu.be/JQPTe2XzDVM OR Text “FAST” to (505) 605-6065
QUESTIONS ABOUT EPIC PRODUCTS AND SERVICES, CONTACT SUPPORT
support@epicproacademy.com
#CreativeFinancing #RealEstateInvesting