How We Know a Deal is a Deal
Real estate is all about the numbers. In this Systems Saturday, John takes you through the his process for “comps” – comparing a prospective property to other properties in the area using the MLS to ensure that he’ll make money when he flips it. If you’re looking to make money in real estate, this is a system you can’t do without.
0:00you know that time is as is everything so we're going to cop out properties and 0:04make sure that you are 0:06cut 0:09done 0:14I did everything myself and here that is not how'd he do 0:18the business and that right there is a house that I have already fled 0:22as well already know that I can flip this house to a bar on my buyers was 0:26like a strong buyers list in this area 0:33hey guys today it is system Saturday that day that I bring you a system that 0:36I use right inside my business so you can take it 0:39rip it off duplicate it using your own local 0:43real estate market on today's session what we're gonna be talking about 0:47is all about copping out properties or finding compare balls 0:51%uh homes congratulations if your Realtor you're going to use copy now 0:55properties 0:55to make sure that you're not %uh getting an bad listings meaning that if you 1:01have a seller call you and they are all we're asking way over asking price for 1:06their home or whatever 1:07it's going to keep you out of those deals if you're a real estate investor 1:11what copping out properties is going to do its is going to basically 1:16I make sure that you get into a good deal and that you are going to profits 1:19on your deal and you know what you're gonna be able to sell your property for 1:22that is what copping out a property means is 1:24finding out a kinda getting up %uh an appraisal of what you can sell that 1:29property for 1:30very very easy to deal okay so there's 1:33there's a out to places they actually do this at the first place 1:37to get a very very quick compare a ball 1:41is Zillow dot com do not trust Zillow dot com I can promise you that do not 1:45trust is a 1:46and is a website that you can go to get a very quick and what they call a 1:50zestimate 1:51okay and it's very very simple all you do I'm going is old are coming on the 19 1:56gonna showed on my computer screen but all you do 1:58as a low dot com as you put in the address 2:01and it will literally give you all the homes around at what possessed a min is 2:06up those homes again is a very very quick 2:09estimate it is not very accurate so don't 2:13put that like its it is that true number cuz it's always inflated I can tell you 2:18that 2:18the best place the best place to go through and find 2:23compare homes is by far the MLS 2:26you do have to be a licensed Realtor or no 2:29a licensed Realtor and order to get access into the MLS 2:33the MLS stance for the Multiple Listing Service every realtor 2:37that is licensed Realtor has access to the and the last 2:40and that is what you want to use whenever your copy now 2:43properties because that is the most accurate data that you can possibly get 2:47its what everybody uses to do it 2:49so make sure whenever you're trying to get the real number 2:53for what a property is worth what you will be able to sell a property 2:56always use the MLS here's how you do it 3:00alright so we have just open up 3:03our local MO us so we are licensed Realtors 3:07I hear and %uh so we do have our own access into the MLS 3:11if you do not if you are not a licensed Realtor don't freak out or anything like 3:14that because 3:15you can have a a a licensed Realtor go through and pull the compare falls very 3:20very simply for you 3:21I'm here's how we do it in order to have me 3:24property that you're trying to get a good value for to find out if it is a 3:28good price 3:29all you need to do is you need to know that address okay 3:32need to know that address now what you want to do is you wanna go to searches 3:36and you want to do what's called 3:37you radius search around that property so I N 3:41in layman's terms what that means is you're gonna do a search for 3:44a you know around a quarter mile out around a certain subject property to 3:49find out what all the active homes are 3:51what all the pending homes are and then what all the homes that have sold 3:55I and thats area within a quarter mile 3:58love your subject property within the last six months 4:02okay those are gonna be your stomp stats right there 4:05okay so once you get here we're going to do a search right here radius search 4:10quarter-mile house now if you're in on how well I land in Ohio are some more of 4:15that were you got you on numeric one fails 4:18in your gonna might have to go out a half-mile 4:21I nor even go out to a mile and and where I personally live 4:25in Ohio we have to go out to miles because I don't so 4:28live around Harvey anything okay but in this case I we're we're buying a house 4:33today and I'm just gonna show you why 4:35I know that we are getting into a great deal okay I'm gonna show you why we're 4:39getting into a great deal on a comp all right now so I'm gonna do a search 4:43around the subject property and a quarter mile around it 4:47and I'm gonna do put in the address right here 1937 same year that I was 4:51born 4:52Commonwealth okay and this isn't senior Ohio 4:57she's a property that we are fine-tuned ads in Ohio 5:01I'm gonna click all the residential properties that are single family 5:04because that's what my 5:06Tahoe man's and then I'm just gonna go down here I'm gonna search 5:09all the properties that are actors active Andy 5:12pending and then all the homes that have sold a minute what it doesn't 5:16RMLS logo are back six months 5:20for you stay on the and soul I really 5:23but to be honest with you guys you don't whenever you're copping out of our been 5:27trying to get a good value for 5:28you don't want to do anything past past six months so you don't wanna go out a 5:33year 5:33you don't want to go out two years and find out what the homes were selling for 5:36six months about the number 5:38you're looking for the most recent his way here really honestly looking for 5:42once we have this 5:44are and here again active the active pending the pending 5:48and then the sold properties Tom we're just gonna click Freeview count right 5:52here find out how many there is 5:53believe there was eight and yes there is eight right here 5:57I was gonna see the results okay so in reality what this did was it took for 6:021937 6:03Commonwealth Drive which is the one that we are buying today 6:06and it is it took their property and it went out a quarter mile around it 6:10and its is telling me all the activity a quarter mile around it meaning that 6:15there's a newly active home right here on Colorado drive it's a three bedroom 6:19one bath answer 2084 square foot 6:21mom for 68,000 K 6:24here's the data one up on the market actually just a few 6:28of four days ago okay said that this is all the cops this is on the counter will 6:33homes 6:34now when every year are buying a house or whether your listing the house you 6:38know as a Realtor 6:38you don't really pay suits you soo much attention to the 6:42active listings saying you don't pay too much attention to that because 6:46I really to be honest with the a and active listing this is just kind of a 6:50a suggestion %uh what's the the sales price is gonna be 6:54known true com the true from Paramore is going to be the sole 6:58and you can pay or out more attention to the pending so you want to pay more 7:02attention to the pending 7:04but the most attention to all the sole properties 7:07we typically always like to see whenever we're buying a property or whether we're 7:12listing the property at home back in Philly whatever 7:15we typically always like to see at least one 7:1810.com and we always like to see at least 7:22sue sold palms within a quarter-mile 7:25away from the property because that gives is a good true assumption I've 7:30watched 7:30are subject property will be able to sell for in this particular case 7:35arm just properties 1937 this is the subject problem this is right here is 7:39the property that 7:41that we are buying right here this is it okay this is the 1i here 7:45okay now here here you're gonna notice 7:48something here now I bought this property rights today 7:51450 Warner fifty two thousand dollars okay 7:55but it's up on the mark for 70,000 so what this tells me is that whenever I 8:00bring us right straight back 8:02to the market whenever I take this back to market what will I be able to sell a 8:06okay so I i immediately look at the bedrooms and then I look in the square 8:10foot so we got four bedroom 8:12one and a half bath and this homers 1592 square foot okay so that is my subject 8:19property 8:20and it's %uh for seventy thousand now if I go and look at all the 8:24sold properties there's two of them 8:28there's one on 1907 Atkinson 8:31dry is a three bed one bath 925 square foot in its sole 8:37for seventy two thousand one hundred dollars 8:40and 75 day see doin car Hyundai 8:44mark okay so it took 75 days and it's all for 721 8:48butts our property is about 8:52600 700 square foot more it has another 8:56half bath and it has another bedroom so obviously I can tell here 9:00that this one on Atkinson my property is worth more than that one 9:03because I have more bedrooms I have more bathrooms and I definitely have a lot 9:07more square foot 9:08here's another one here's another sold property: right here on Westbury Court 9:13it's another three bedroom 1 bath 1200 9:16and 13 square foot and this one sold in 10 days 9:21for 75,000 now I really really like that 9:24and I like it because for a couple reasons because the square footage is 9:27more 9:28okay so it's it's still less then what's my property my subject property is 9:33but then it the it has one less bedroom in one last half bath 9:38so obviously mine is gonna still be worth more than 9:42some vibrant so I'm just gonna take a quick look at this one because it's it's 9:45honestly gonna be one of my best com sold 9:49in parables okay for 75 transfers to look at this 9:53a messy with the outside looks like compared to mine okay great property 9:57description apparently they didn't get the job done schools writing from 10:01screens motivated self for you gave me a great reason to buy that prop 10:06anyways here it is and 10:09and here's the property it sold for cash so I do like that so that tells me that 10:14there's cash buyers in this area for 75 min 10:16and ice on 10 days again and then they've only got one picture so 10:20they broke about every single rule that I i ever 10:24have talks and that we ever do I and our companies but signing up for our results 10:29so 10:29its it's nothing special and it looks like they had a converted garage as well 10:34right here that they just got like a screen door maybe is a screen or a fun 10:37that I don't know what it is 10:38affect however when I go back 10:41to this and I look at our compare one the one that I'm buying if that's a 10:45forbad 1/2 bath 10:47I don't see this as a bylaw so on that was not 10:50a good a good compare wall have a home but it's still souls like 75 brandon is 10:55in 10 days 10:56so that I know and I know that I got this thing under contract 450 2000 11:02so I I know that I got myself into a great deal 11:05already okay so the cops so far are working out that isn't 11:09use anybody wants that 11:13I will give that to anybody free I'm not gonna charge for 11:17I'm you do have to pick it up in the beautiful city ovitz 11:20you on but anyways 11:24I'm just looking here and mines a lot bigger you can obviously tell 11:28by levels size right here and then has your 11:31fine on your Windows everything like that so on if I go back 11:36to mindless right here oMG I see this to seoul comp 75 ran 10 days 11:41palm I like I like it because mine is still 11:45better than that for the 75 gram now if I go right here too 11:49us some more active cops 11:52okay so if i start looking a little bit deeper and this 11:56I'm gonna see that there is one pending 11:59on the same road that's mine is 12:03so same exact road is a three-bedroom one-and-a-half at $16.92 square foot so 12:08it has a little bit more square footage but I have one more bedrooms and 12:12that is going to be my best softness as 12:15pending right now for Haiti 29 so if I look at that picture on this 12:19I'm gonna see here this is a tri-level 12:23on my level but as a trial up so it does look like it has 12:26om then a renovated to some extent 12:30right here so it does look like it has been renovated to some extent 12:33but it is our one of my best part because the square footage is that on 12:38the bedrooms as one last and then the 12:41the bathrooms is right that are okay same as actually so that is my Bascom 12:46for this and is pending right now 12:48okay and that is and it went up on the market for 82.9% 12:52I go through your look at the active companies are kinda just dreamers I 12:55guess you'd say. 12:56right now 14:59 this is going to be another great 13:01compare with this is a bank owned property and I do know 13:05this businesses a bank improper know the Straits Times 10 13:08here on but this is going to be another good compared to the so another bank I'm 13:12probably for 84 ninth 13:14on that would probably sell pretty quick same square footage 13:17so I know that my property right here you can base based upon what I see here 13:22I properties worth over 75,000 and it is probably and there's pending problems 13:26for any 29 13:28and there's active properties editor literally just got 13:31active with the same square footage with one less bedroom for any 13:34in the amid eighty $84.99 13:38okay so I could put a very quick 13:41John's estimates on this property over 75 13:45thousand but under 85,000 that's that's about where I wanna be 13:50on this okay now anybody that knows anything about this this is a hard 13:56problem that I am buying on 13:58Commonwealth and what my strategy is II wanna take 14:01all of my frat least high and sell them cheaper than what hugs sold them 14:06for had them up on the market for so I put this under contract like 14:0952,000 and then what I'm going to do. 14:12is I'm going to take this right back to the market for either 14:16on +64 9 for 16 99 okay and it's probably going to be the 64.9% here's 14:22why 14:23okay whenever I go and I look at this and and somebody else does if 14:26parable for this property they're gonna see that the lowest thing up on the 14:30market is 68 house I wanna be tough 14:33I want feat that and I wanna be the cheapest thing on the market 14:36for the most bedrooms and the most square footage because I'm guaranteed to 14:41make a sale on 14:42okay song guaranteed to make a sale on its a very very quickly 14:46what I'm going to do is oMG I was just going to put a price tag on line for 14:5064.9% 14:51and then I know that I bought it for 52,000 okay 14:55so I know does anybody disagree with those numbers based upon 15:00the way that I just show you how to come comp these properties out 15:03absolutely not because that is a great number four so 15:07keep in mind whenever you're comin properties out you always need to look 15:11for 15:12at least one active comp you're looking for at least one pending 15:16of and you want is fine and least sue 15:20sold cops if they don't have that goal 15:23don't get involved with the deal don't get involved with the deal don't try to 15:26make 15:27ideal out of nothing I try to do that for the first eight years of in business 15:31and 15:32I'm lucky I didn't have to file bankruptcy or foreclosure that's the 15:36whole truth of 15:36don't try to make a deal how does just these numbers 15:40make sure that it is a deal so to seoul cops one pending top 15:45and at least an active competition and you know you got a solid deal 15:49you can get a true value for that so 15:52are the last thing that I want to do just since I am showing you this 15:55particular properties I wanna show you how I know what I'm going to make 15:59on this property by a ideal 16:02analyzer that I've created I've got a ton of windows open right now 16:06I wanna show you how I already know what I'm going to make on this property from 16:10a deal analyze and I've created and for everybody that goes through any comments 16:14on this video I'm going to give you this deal analyzed 16:19going to give you this deal analyzer so your net so here's how I know 16:231 I'm going to make on this particular property 16:26right before I got into so comments gonna put right here in 1937 same year 16:32that I was more 16:33a commonwealth okay encino 16:38single-family home is not my love this is a selling deal analyzed by raising 16:43name is actually my mother 16:45and today's date first 16:51to of on the purchase price 16:54so what this means is what I'm going to be selling it for 16:57yes everybody the comments on this video tells me 17:00what they think in the system Saturday's I'm going to give you 17:04access to this to this Excel spreadsheet right here 17:07purchase price what I'm gonna sell for 60 49 bank total amount owed 17:12which was 52,000 by Mark 452 grant realtor commission and Mike and the pain 17:17relief mission on my gun assaults my list always do though 17:20worst-case scenario that i'm gonna pay a realtor commission I love at least 3 17:24percent 17:25on us now what I'm going to do is instead of Payne 3 percent on this which 17:30would be over 1500 mAh something of a flat fee 17:33for fifteen hundred dollars %uh for 17:36to realtors the annual property taxes how much is that 17:39running so I'm just gonna do a quick search for this and find out what enough 17:44property taxes are on this property 17:46648 times two summers gonna up but that they are fourteen hundred dollars plus 17:51obviously is inflation but I'm making sure that I'm getting into a good deal 17:55some 17:56fifteen hundred dollars a night closing of and number 17:5910 on this is july so obviously not be a7 18:03sex would be june 11 the January 18:06so I'm gonna put seven 18:08right there 18:10and proration types you always want to do this is along 18:13owners insurance my gonna pay owners entrance why someone yes 18:16free her bosses what we pay: om fires 18:20paid at closing costs on my compy anything because I'm gonna get a cash 18:23buyer 18:23she saw a cop their for that miscellaneous expenses I personally I'm 18:28not gonna have any on this if you have any 18:30I miscellaneous expenses when virus you to pay for something in ur 18:33something like that all miscellaneous expenses will go right straight there 18:37from escrow right down here in a flat-out tells me that I am going to be 18:41making nine thousand 834 dollars and ninety cents on this property 18:46based upon these numbers okay so at the end of the day 18:50I'm going to cause I do get a real or commission when I do buy this property 18:52we're gonna have a right around fifty thousand five hundred dollars and this 18:56property 18:57on so fifty thousand five hundred and this property a school right down 19:02so we're gonna make a little bit over eleven thousand dollars 19:05on this particular deal selling it at 260 for nine so 19:09on that's how we copped out properties okay that's how we copped out properties 19:13guys 19:14I can tell you that you make sure are you getting a good deal by comin up 19:18properties and by far the best place to do it 19:20is the analyze our time here 19:24so I'm here this is the property that we just comp doubt 19:28be seen it I just bought this thing guys you have to copy properties out and 19:32order to make sure that you're getting into a good solid the of 19:35this right here is a good solid deal this is a good solid deal 19:39my numbers do nothing but work on this so I bought it 19:42cheap and what I'm going to do is is %uh next week 19:46okay next week for small I want you to comment on the video below 19:49okay comment on the video below and let me know what you think the system 19:53Saturday's I'm going to give you 19:55best-selling deal analyzer so that you can 19:58by properties like this with confidence okay and no 20:02what you're going to be making on every single one of your deals with your 20:05Realtor 20:06real estate investor it doesn't matter you need to get your hands on some for 20:10everybody that leaves a comment on the video below 20:12you're going to get that selling you analyzer for free there's nothing to buy 20:15I'm gonna just you know what straight out to you now keep in mind 20:19that we are already at this house okay I'm at this house in on next week's 20:24system Saturday session guys I'm gonna show you how we take this property 20:28and how I market this probably the 15 steps 20:31that I use every single time to market the all my properties 20:35to get them sold and seven days or less a stay tuned to next week's system 20:40Saturday session cuz i'm tony is gonna blow your mind 20:42when you see all the steps that I use to market all my properties 20:46its own seven days a last comment on the video below get your hands on that 20:50spreadsheet 20:50check out how I do it next week on next week's essence RSS