When it comes to real estate, cash is king. There’s no need for a mortgage and the property will appreciates over time because you’re not paying interest on your loan! But how do you accurately formulate an offer for a house in Florida? If this sounds like something that interests you, keep reading and learn how we go about making an offer when buying with cash in Florida.
Determine Market Value and Reduce a Small Percentage
The point in how to formulate an offer for a house when buying with cash in Florida is to find out what the market price of properties are and then subtracting a certain percentage from that amount. You can get this information by “pulling comps” which is finding out how similar houses have sold recently in your area. Depending on the exit strategy (or strategies) you choose, it will change the percentage needed to take off the market price.
By working with a real estate agent, you can get up to date information about properties in the area. They’ll also help determine what your offer should be based on recent sales on the Multiple Listing Service (MLS). It’s possible for you to do this on your own as well, but it would require a paid subscription to one or more of a number of different MLS systems. Here in Florida, it’s common to use StellarMLS by Matrix.
Reverse Engineer Profits
ow to formulate an offer for a house, many homebuyers work backwards from the purchase price. They figure out how much they want their profit margin to be and then subtract that number from what it costs them in total for the property. However, this can get tricky if you’re not sure of all your expenses going into buying the property or renovations–so make sure you have as good relationship with contractors so they can help estimate those numbers accurately!
For example, let’s say you want to make $15,000 on the property and you know that the property will cost $25,000 to repair. Then, you might offer $30,000 to the seller, but later you sell it for $45,000. Using this strategy helps you think ahead to consider what you can get for the property and whether you’ll be able to make a profit.
No discussion about how to formulate an offer for a house would be complete without bringing up the possibility of seller financing. With seller financing, you might pay some cash and then have the seller carry a note for the remainder. This can adjust your profit point and how much you can pay per deal.
Why spend hours and days going through the tedious process of making offers, waiting for responses, negotiating terms etc. when you can buy from us at a price that is fair to both parties? We have done all your work so that you get a quality investment property with little effort on your part! There’s no need to spend time trying to formulate an offer for a house in Florida. We’ve already done all that heavy lifting.
To see our inventory of available real estate investments, fill out our online form at FloridaPropertyWarehouse.com or give us a call anytime!