Q: If I am looking at a multiunit to flip to an investor, how to do I determine what to offer my buyer?
Terri Dobbs: If you are asking how to price the unit, before you do any deals you need to do your analysis. Look at it and make sure the financials are okay. If you are wondering what to offer as a flip fee, real estate entrepreneur Lance Edwards advises that you start out modestly.
Get your first deal done by asking for a 3 percent flip fee, and if the number if kind of funky, you might round it up a little bit. Keep the fee modest, and once you’ve done a deal or two, you can up the fee a little bit. Add your flip fee to the price you are paying for the property.
For example, if you are buying the property for $100,000, you will charge your buyer $103,000 to cover the cost of the property plus your flip fee.
Want more great advice? Get a free copy of Lance Edwards’ No. 1 best-selling book, How to Make Big Money in Small Apartments here.