30 Days to Real Estate Cash 83
Why the $300? Why not just $48,000 even? While that may be the way the math worked out in this example, we would have that $300 on every offer. It makes it look like we’ve sharpened our pencil and thoroughly run the numbers for our very best offer. Round thousands don’t look like we did that.
$48,300 Offered
If you are buying this property to buy, fix, and flip for yourself, the purchase price of $48,300 to $53,300 would make the deal work for you. The most you would want to pay based on your formula is $53,300. As we discussed, we would not start our offer at $53,300 and we want to negotiate as much as possible. The less we get the property from our maximum offer price that we determined we could offer, the more potential profit for our pocket. The more profit potential in a deal, the more options of what we can do with that deal. Now let’s take a look at wholesaling this property to an end buyer. There are a variety of end buyers that we need to con- sider for each deal: Based on the example above, you would have to know what your end buyer wants when it comes to profit from a deal. If they were happy with a profit of $20,000, then the most they could pay for the deal is $53,300 based on your formula. If your exit strategy is to lock up the deal and then assign it to the end buyer, you would have to get the property for less than $53,300. For example, if you wanted an assignment fee of $3,000, you would have to lock up the deal for $50,300 or less. If you wanted an assignment fee of $5,000, you would have to lock up the deal for $48,300 or less. Thus, when your The End Buyer Who Wants to Buy, Fix, and Flip a Home for Profit.
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