To succeed in real estate investment, it's essential to approach the offer process with a smart and competitive strategy. With the right knowledge, you can make winning offer sthat is based on accurate research, thorough property assessment, and a clear understanding of your budget and profit goals.
Today, I will be sharing 5 tips for making winning offers on your fixer-uppers.

Research and Determine the After Repair Value (ARV)
Before making an offer, you need to know the estimated value of the property after you've completed the renovations. This can be done by researching the local real estate market, checking comparable properties, and getting the current prices of the materials that would be required to renovate the house. Understanding the ARV will help you make a competitive offer while still making a profit.

Calculate the Maximum Allowable Offer (MAO)
The MAO is the highest price you can pay for the property while still making a profit. It takes into account the ARV, renovation costs, holding costs, and your desired profit margin. There are different formulas to calculate the MAO, but a common one is: ARV x 70% - renovation costs - holding costs - desired profit. Knowing your MAO will help you stay within your budget and make a strong offer.

Assess the Condition of the Property
Once you have determined your MAO, it is essential to assess the condition of the property. By inspecting the property thoroughly, you can identify any major repairs or renovations that need to be done. This information will help you refine your cost estimates and adjust your offer accordingly. Being aware of the property's condition will also help you determine if waving inspections is a viable option.

Make Your Offer
Once you have a clear understanding of the property's value, your budget, and the work that needs to be done, you can make an offer to the seller or their agent. Your offer should be based on your MAO, but you may want to start with a lower number to allow for negotiation. Consider communicating to the seller that you can close quickly, as this will make your offer stand out among the crowd. Also, offer to pay in cash, at once, so that you can get a better deal.

Negotiate and Close the Deal
Once the seller receives your offer, they may accept it, reject it, or make a counteroffer. If you come to an agreement, you'll need to sign a purchase agreement and provide a deposit. You’ll also need to complete any due diligence before closing the deal.

Stay tuned for the next episode where we'll discuss strategies for increasing the value of your properties through effective renovations. I will give you valuable insights and tips on how to make the most out of your investments. Don't miss out!

Regards,
Lukman Shobowale