Having the right Realtor can make or break you.
Filed Under ( Flipping, Realtor ) by Joe Somebody on Wednesday, February 16, 2011
My Realtor has been really awesome to me. The biggest thing that he has done for me, was finally getting me to view the home as an investment. I was way to personal when I was first going into these homes. He showed me how to look at the house from a different perspective. Once I had the mindset of a business and not of my dream home. I was finally able to decide.
Another thing that he taught me was the "spread". This is just what it sounds like. Just like placing bets in a game. You look at the spread. Take the price of the foreclosure minus the appraised value minus and home improvements. What is left is the spread. This is what you have the potential to make when you go to sell the house.
My goal was to have at least a 20k spread. I can up with that number because I want to sell any house I buy in two years. I want to make about 10k a year sitting in the house. This is actually hard to do. But in a foreclosed house, you can have instant equity because you are buying it way under value. Some people also call this flipping. I dont consider it flipping because flipping is usually done much quicker. Sometimes within a couple months.
But sitting in the house for two years also has one very unique benefit. Any profit that I make off the house is Tax Free. Thats one thing I government has done right. If I sell before the 24 month mark. I owe taxes on all off the profit. That could get into the thousands really quick.
This is why flipping is such a fast paced job. They want to get there money back as soon as possible. The longer they are in the house. The less money they will make. Because there cashflow is tied up in a property.
Seems like good advice. Ideally the real-estate market will bounce back and we won't be seeing the double-dip we have all been hearing about.
Interesting. I've never thought about putting a spread value like that on a home. Seems like good advice.
I know exactly what you are talking about my father is a realtor.
Following to see more.
you also have to consider that owning the house for those 2 years costs abit of money aswell
hmm thanks for advice
if the bench your sitting on waiting for the bus has your realtor on it. he isnt the best bet.
that is right i need good realtor in Brussels to find good appartement.
My parents had a good Realtor that helped them out a lot.
I am actually a licensed real estate agent. So yeah, I can confirm this.
hmm, very interesting!
oh, gosh, finding good apartments on your own is a pain.
does your realtor charge you for teaching you about realty?
@Rogers - Nope. He has been one of the most stand up people Ive ever met. He answers any and all of my questions. He is even going to help me decide what to fix up in the house that gives the biggest bang for my buck on resale. Cost me nothing extra.
dam.... thanks for the advise it was interesting
That's a lot of money to make off a house.
Interesting stuff, flipping sounds like it could be a big earner if done correctly. Followed.
The two year tax, is that a federal tax or a state tax?
@AssortedNews - Its the federal capital gains tax.
woohoo I'm the 100th subscriber :p
Great advice as I will be apartment shopping soon. :P Thanks
any profit you make is tax free? that's awesome! great advice man, definitely looking at things differently now
Good advice. Am looking for residence for college next year.
Great article, I'm looking to move out soon.
I do like to hear of people beating tax, it's such a pain in the arse.
I'll be looking back to this when I finally move out of my apartment!
good advice.
I cannot wait to move out. The sooner, the better. Thanks for the advice!
Great article with good advice.
That's some useful info you have there. Thanks.