Be An Ultimate Property Analyzer

Be An Ultimate Property Analyzer
By Larry Goins

Success in real estate is partially due to having the right tools and knowing how to use them. I teach my students to maximize their time with tricks and tactics that make buying and selling real estate in any market a snap.
One of the most popular tools that I have made available to my Ultimate Buying and Selling Machine students is the Ultimate Property Analyzer. Many property analyzers are big, slow and bulky. They are difficult to learn to use and even more difficult to use rapidly while you are on the phone doing the deal on a property. I wanted to find a simple program that we could use to quickly calculate how much we could afford to pay for a property. But there wasn’t anything available. So I had The Ultimate Property Analyzer created to help my students and I analyze a property quickly. Remember, we make our first offer during our first phone call and this little program lets us do it with maximum confidence.
With the Ultimate Property Analyzer all you have to do is enter the repaired value of the home, use your pre-calculated closing costs and other expenses, and the program gives you an offer automatically. You can even tweak the details around how much you want to make on the deal if you are wholesaling or retailing! It really doesn’t get any easier than that.
Let’s say for example that we have a property with an after repaired value of $70,000. 70% of that ($100,000 multiplied by .7) is $70,000. This is the dollar amount that my investor buyer would have in the property after all the costs are added back in.
I subtract out the hard money closing costs which average four points or $2,800. Now I’m down to $67,200. I also subtract out taxes, insurance, attorney fees, etc. and at an estimated $5050 that takes me down to $64,950. Now I assume that the estimated needed repairs of $15,000 are accurate, which leaves me with $49,950 to work with.
Don’t forget your profit. At this point you want to figure in how much money you want to make on the house. Let’s imagine that I’m looking for a $5,000 tax free income off this property. That means I cannot pay any more than $44,950 for the property. We know that most sellers won’t jump on the first offer, without at least dithering a little, so I’m going to offer a little lower than that. I always make an offer that is not a round, even number. Say for example, I can safely make an initial offer in my first phone call of $38,780.
Why the uneven number for the offer? It lets the seller know that I’ve done my homework on the property. They perceive that I’ve got what I can afford down to the dollar.
Also in The Ultimate Buying and Selling Machine course there is a DVD tutorial on The Ultimate Property Analyzer. Its designed to teach you EXACTLY how to use it so that you can get the most out of it. The tutorial is very short and sweet, and you should be up and running with The Ultimate Property Analyzer right away.
Remember in our office we buy ten to fifteen properties every month. And we don’t go look at any of them. I know you cannot do that just starting out in real estate investing, but once you get rocking and rolling in the business you will be able to do it too. Once you implement my UBM system and set up your own ultimate buying machine you will be able to buy ten to fifteen properties a month, too.
Once the system is implemented and the machine is in place, you can go into any city, anywhere in the United States, and buy and sell property. Anyone can do this. And I will teach you exactly how to do it in just a few hours a week. Imagine using The Ultimate Property Analyzer to make ten or fifteen offers a month. If you close 50% and do $5000 profit on each, that is an extra $50,000 in tax free money every month. I know this sounds like a lot of rah rah and you probably wonder if I didn’t just roll out of an Amway convention. But I cannot help but be excited about the system I’ve developed, the money I’ve made and continue to make, and the people that I’m teaching to do the exact same thing!
In our office we set up new markets every month. Often times in areas that we have never set foot in. For example, we just completed a transaction in Cleveland, OH (of Drew Carey fame). It was our first deal in Cleveland. We actually sold the property the same day that we closed on it and made $8000 without ever leaving sunny South Carolina. You can do this too!
When buying a property, as I mentioned earlier, you need to be able to get into the deal for no more than 70% ARV (after repair value) including purchase, rehab work, and closing costs. That is when you plan to rehab and sell to another investor. But, if I am looking at a property that is an “Instant Landlord” opportunity – already fixed up or already in good shape, I can go up to 80% of the ARV. I wouldn’t recommend going any higher than that. You don’t want to risk getting upside down in your financing or your real estate ownership. You want to leave a little bit of wiggle room in the event you ever need to sell quickly.
If you stick to the 70-80% rule, you will always be able to sell a property. Now remember these are percentages that hold pretty true in my area. Your location may be different. Talk to other investors near you and do some research to see what the market will bear. Also, if the property is already in good shape and doesn’t need any repairs, you can get into the deal without a rehab loan. Therefore you could probably even qualify for a traditional loan up to 100% of the ARV depending on what your credit would allow you to qualify for. Perhaps you could do this with no money down. But, if your goal is to buy, fix it up, then re-finance and rent out, in most markets you will need to stay within the 70% ARV range. Fix it up, then re-finance at 75-95% of the loan to value, and pull out your cash.
That cash is of course Tax Free as you don’t pay tax on borrowed money. Then you can rent the property out at positive ash flow and have Tax Free cash in your pocket.
I hope you have enjoyed this article taken from my course called the Ultimate Buying and Selling Machine! that teaches how we buy and sell 5-10 properties a month, never look at them and have them sold in less than 2 hours. For many more articles and a 10 part ecourse on how to create your own Ultimate Buying and Selling Machine! as well as over 50 training audio recordings you can listen to online, download and collect, simply go to www.LarryGoinsFreeOffer.com where you will gain instant access to all of this and 51 Exclusive Editable real estate investing Forms and Documents all FREE! You will also get two FREE real estate investing eBooks, A free Personal Coaching Profile to help you jump start your real estate Investing, FREE Nationwide Wholesale Property Listing Notification, FREE Weekly Training Teleconferences with Different Topic Each Week, FREE subscription to Larry Goins “Almost” Weekly Investing Newsletter, FREE Admission for Two to Investor Palooza 3 Day Training Event, FREE Admission for Two to Larry Goins 3 Day Boot Camp, Plus over 31 Exclusive Articles on real estate Investing and Much More! Just go to www.LarryGoinsFreeOffer.com. Thanks and I look forward to working with you, Larry Goins