3 options for buying this house - which one would you choose? blog by RJ PalanoThe Art of Buying Houses blog by RJ PalanoOccasionally in a deal we acquire a property through our lead generation system that fits every exit model we practice for houses.

In review, we acquire houses and exit or hold as follows:

1. Buy and hold.
2. Flip “as is” to an investor.
3. Rehab and sell to investor and manage for him or her.
4. Retail to the general public.

3 options for this deal - what would you do? The Art of Buying Houses by RJ Palano blog

9540 Sleepy Hollow Drive

The property located at 9540 Sleepy Hollow Drive in Jonesboro, Georgia, was acquired on Monday, July 5, 2015, after we signed a contract to purchase on June 24.

There is a great expression that the late great Jack Miller used all the time: “Never steal in slow motion.”

This house deal was an extraordinary opportunity that was purchased for more than 50% below real market value.

When we have an opportunity this good, we want to close it as fast as

possible before the seller talks to anyone else.

3 options for this deal - what would you do? The Art of Buying Houses blog by RJ PalanoAnd let me tell you: they talk to their friends, family, the mailman, and every one of these people know someone who might want the house.

When the profit margin is this high, work to get it closed fast and avoid the risk of another buyer coming into the picture.

By the way, just because you have it under contract doesn’t mean someone won’t go behind your back if they get a higher offer to sell to someone else.

I do everything I can to protect myself and when the competition was so
strong in Florida eight years ago, we would have the seller sign a mortgage 3 options for this deal - what would you do? The Art of Buying Houses blog by RJ Palanoto us to secure performance in the contract.

This is a safe way to protect your interest, and it worked for me.

It can work for you, as well, if you know how to ask the seller for it in a way that shows you are protecting the seller.

The Sleepy Hollow Drive property about which I write today is a three-bedroom, two-bath, two-car-garage house with 1,404 square feet. It will rent for $850 – $950 per month. The rehab will cost $6,000 to $7,000.

We already closed for $37,500 and this created a dilemma:

  1. Do I buy, hold and create a 15% – 20% cash-on-cash return with a terrific long-term capital gain in place?
  2.  Should I flip it for a fast $20,000 – $25,000?
  3. Or, should I rehab it for $7,000 and sell it to an investor for $80,000?

This property would be a challenge to sell retail; therefore, that would not be one of my choices.

You can see the pictures above and here is a video of the property.

The 3 options for this deal – What would you do?

These are the problems we love to have, and for the record, we will rehab, sell to an investor and manage for them.

It’s important to always have more opportunities than you can take advantage of because this forces you to sort the best opportunities.

Meet RJ in this video.

If you ever have a question on how to structure a deal, call me at (813) 495-3006.

To your investment success,
RJ Palano

Visit RJ’s site here.

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  • R J Palano

    RJ Palano is the acquisition director of BuyCashFlowProperties.com, a Tampa, Florida-based company that primarily provides turnkey houses for investors in the metropolitan Atlanta and Tampa Bay areas. His property management experience spans more than 35 years, and he has been involved in more than 3,000 real estate transactions in 12 states and more than 50 cities. Contact him at 813-495-3006 or rjp@buycashflowproperties.com.

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