The REIPro Blog

Helping you Build your Real Estate Business
with Investing Tips from the Pros
How to Analyze and Run the Numbers for All Real Estate Investment Deals
By
Chris Goff

One of the most important steps in real estate is what I call step 4, making offers. If you never make an offer, you’ll never make money in real estate. But, before you can make an intelligent offer, you must first find a potential deal, inspect the property and speak with either the owner or the person who can make the selling decisions. Here’s where the magic happens…

 

Analyzing real estate investment deals really starts with determining the sellers ‘situation’.  Every seller has a situation and your goal as a real estate investor is to find out what it is. The seller’s situation not only determines how you will purchase the property, but also your exit strategy (how you will sell the property). This is known as the… Real Estate Strategy.

 

Here are Some Common Seller Situations:

  • Vacant home
  • Behind on payments
  • Divorce
  • Job transfer
  • Death
  • Tax lien
  • Hard time selling
  • And many more

Here are the Real Estate Strategies:

  • Wholesaling
  • Fix and Flip
  • Buy and Hold
  • Seller Financing
  • Lease Options
  • Straight Options

It’s common that most investors only utilize one real estate strategy which limits how you can purchase and sell real estate. Having multiple solutions for the seller will increase your acceptance ratio of Yeses. Not only giving you a better chance of acquiring the property, but selling it too. We all start off with one strategy, but in time, you should learn them all.

 

Example:

Let’s say that you find a potential deal and determine that the seller is getting a job transfer. Now, most sellers would love to be cashed out and be done with the property. But, what happens when it doesn’t sell? The seller will most likely rent the property out and become a landlord. Here, you have multiple solutions you can present to the seller.

The first thing you will want to determine:

Is the seller open to a cash discount? If so…you could potentially wholesale or retail the home.

Is the seller open to ‘terms’? Meaning, will they accept monthly payments for a short period of time, then be cashed out? If so, you can offer a Lease Option or Seller Finance. With these strategies, you can pay the seller more on the sales price because you would be purchasing the property on, ‘terms’. Terms is where you make your money. How much down, monthly and the backend sales price. Note: you’ll profit 3 ways on every deal.

As you can see, you now have multiple ways to purchase the property as well as selling it. Again… it all depends on the sellers ‘situation’. You are either buying the property with a cash discount or terms. But… why not offer all 3 at the same time?

Offer #1 – Cash Discounted Offer

Offer #2 – Lease Option Offer

Offer #3 – Seller Finance Offer

 

Here, you’ve given the seller multiple offers and more options on how they can sell as well as giving you a better shot at getting the deal.

Now, we can now start to analyze and run the numbers for all 3 ways to purchase and sell the property. Since there are thousands of ways to run the numbers, you need a calculator to run all scenarios.

This is where DEALPro comes in. DEALPro is now helping others do the same thing, by analyzing thousands of scenarios, to help you determine the best and most profitable way to buy and sell houses. Making the correct offer is one of the most important steps, and DEALPro does it with ease.  You can run the numbers for every type of purchase strategy to exit strategy including Wholesaling, Lease Options, Seller Financing, Cash Purchasing, Traditional Financing, Private Financing, Hard Money and Rentals. See how much you can make with every deal in seconds.

Click here and start your 30-day free trial.  It will be worth your while.