How Ugly is Ugly?

**rburns** · 09-10-2008, 08:24 AM

I'm fairly new to wholesaling and I've come across a number of "distressed" properties. The question I have is how do I make the "cut" on properties that are probably not worth doing the follow up? For instance, I drive up to an "ugly" house that is obviously unoccuppied and not being maintained and requires somes repairs, how do I in a time effective way determine whether I should put this house on my list of potential wholesale properties or not? So how Ugly is Ugly?
How do I determine rather quickly if the repairs/improvements are within a reasonable cost range relative to the value of the property? I am thinking making this decision is very important before I spend the time to try and find the owners and go through the contract negotiation. What do experienced wholesalers do about this situation?

**vanclark** · 09-11-2008, 01:02 PM

It's tough to give you an answer on that if I don't know what exit strategy you plan on plugging the ugly home into.

What do you plan to do when you get the ugly house?

**quick-mentor** · 09-24-2008, 04:48 PM

You're actually going about it all wrong. You'll get your best results by contacting the owners and IF they're motivated enough, then and only then should you spend time on anything. Find a way to contact them...call or better yet, compile a mailing list. Just don't waste 1 minute of time on qualifying a house before you even qualify the seller. After you hear from the seller, if they are "qualified", then start at 50 cents on the dollar minus repairs and closing costs and work up no higher than 65 cents on the dollar minus repairs. The formula used to be 70% of after repaired value (ARV) minus repairs but with the market the way it is, thats too high.

**DGoldstein** · 10-15-2008, 01:42 AM

What a great post title this is!
I don't know that "ugly" really has much to do with it though if you're talking about appearance anyway. If you mean "broken" that's another thing. People buy ugly houses. I've seen people buy pretty houses and then make them ugly!
Seriously though, you have to make your choice based on the likely ROI. Who cares if it starts out ugly?

**Fresno Office Rentals** · 10-24-2008, 03:15 PM

Ugly is as Ugly Does.......meaning if the rest of the neighboorhood is Ugly bad also and in need of huge repair, then I'd stay out of that place.
BUt if the house is built solid and sound, and the neighboorhoods not bad, then I'd look it over. But with this market going out and repairing a home may put you in a huge hole, that you can't sell or rent or get out of for years. The house may just sit there for years. Why gamble?