Chapter 13
How to Buy Below Market value
CALCULATE THE MAXIMUM PURCHASE PRICE
To do this effectively, you need a formula that factors in all
costs as well as your profit margin.
The following table best illustrates this formula:
Work out the end selling price and deduct-
Purchase/ closing costs
Renovation costs
Selling costs
Profit margin @ 25% of purchase price (or any other profit margin
you desire)
The final figure is the ideal or maximum price that you should
pay. Not a dollar more!
MAKE AS MANY LOW OFFERS AS YOU CAN
Eventually, one will stick. An agent's job is to negotiate
the best possible price for the seller. They are also required to
submit all offers to their clients, regardless of how ridiculous
they are. It is not their job to make judgments on behalf of their
client.
There have been many occasions when a distressed seller has been
happy to accept a lower offer due to their particular circumstances.
Always insist that the offer is written on a contract to show that
you are serious. If the agent refuses because they perceive the
offer to be unacceptable, politely remind them that they are obliged
to present the offer to their client.
Should they still refuse, approach the seller directly. |
