Is it possible to buy at 70% of market value?

[Damap]

Got a link to those courses Damap?

"Rich-then-Bankrupt-then-Really-Rich-Dad, Poor Dad"

I'm thinking you mean these people walk away from their debts but don't actually go bankrupt. If they did, surely no one would lend to them again?

No America ain't like that. As I said in my example they gave him the project back while he was still bankrupt. Bankruptcy lasts often as short as 18 months there and you can rebuild your credit rating within a year. Nothing at all like New Zealand.
The how to is taught at many aggressive gurus courses. I had someone sit me down once over lunch and tell me how to do it. They couldn't believe it when I said I thought it was reprehensible behaviour. "It is just a neat way to get rich", they responded :-(.

If you are actually interested 2 parts of the strategy are "cramdowns" http://www.alllaw.com/articles/nolo/...-cramdown.html
And "lien stripping" http://www.alllaw.com/articles/nolo/...-mortgage.html

The US system is a rort of awe inspiring proportions.

[DaveW]

Just to test this, has anyone bought a property for "20% below market" in Auckland in the last 4-5 years?

No answer to this. We need a survey here, i'm curious.

[spaceman]

^ Of course they did ...all of the kool-aid drinkers purchased at 20% below market ......whatever they paid was 20% below market..... sometimes even 30%....and you're a dream-stealer if you say otherwise

Cheers
Spaceman

[DaveW]

So you saying every sale on the open market is market price? and if its sold a week later for 20% more it is still market price?

[spaceman]

^ Silly billy hasn't been paying attention

Of course not.......that'd be the sensible definition of the market price.....you know the actual amount it sold for on the open market.

Instead what really happens....as long as you've drunk enough kool-aid .....you buy at 70%-80% of market value ( it's a regular thing don't you know), then when you sell it a week later you're selling it for 20%-30% above market value.

Don't be a dream-stealer

Cheers
Spaceman

[DaveW]

^ Silly billy hasn't been paying attention

Of course not.......that'd be the sensible definition of the market price.....you know the actual amount it sold for on the open market.

Here we have two varying amounts on effectively the same open market, being a week apart. Do you think it can be done on the current market in Auckland?

Instead what really happens....as long as you've drunk enough kool-aid .....you buy at 70%-80% of market value ( it's a regular thing don't you know), then when you sell it a week later you're selling it for 20%-30% above market value.

Now that's not only buying below comparative values by 30% but also adding value to the property to sell 30% above comparative values. That a 60% gross profit (Or 40% profit if we use the 20% figures).

[Wayne]

You can buy a house below market value if you are in the right place at the right time.
But can you do lots without that creating the market value?

[Wayne]

You don't understand Damap?
You may find a really motivated seller who will sell at any price if you give them the money right now.
So you buy the house below true value obtainable if you have time to wait for the right person at the right price.

Say you buy a dozen houses in an area at 'below market'.
Then you try to sell them.
People will look at what houses are selling for in the area and see the dozen you brought.
Those below market values will pull the market down and create a new normal.

[DaveW]

You don't understand Damap?
You may find a really motivated seller who will sell at any price if you give them the money right now.
So you buy the house below true value obtainable if you have time to wait for the right person at the right price.

Say you buy a dozen houses in an area at 'below market'.
Then you try to sell them.
People will look at what houses are selling for in the area and see the dozen you brought.
Those below market values will pull the market down and create a new normal.

To find a whole area of "motivated sellers" selling "below true value" would not fit into our plan.

[Damap]

So not likely to happen though Wayne. you can always buy under the market if you hunt hard enough. If you can find 12 deals in the same immediate area at the same time then I would say you are kidding yourself about the real market price.
This whole debate is inane but a fun way to spend morning tea time. Those of us who do buy and sell know you can buy under and sell without doing any work to the property. It just takes lots of offers and networking etc. It's work but well paid work.

Those who don't believe it should be left to their own thoughts. It's less competition that way :-).

If your theory were valid then it would be working in the USA where entire suburbs are devaluing. Yet it is easy peasy to buy and flip in a day in so many cities it's ridiculous.

[Wayne]

If your theory were valid then it would be working in the USA where entire suburbs are devaluing. Yet it is easy peasy to buy and flip in a day in so many cities it's ridiculous.

I have no experiance in the US but
If entire suburbs are devaluing and it is easy to find cheap houses there must be a lot of stupid people to sell them to.
Maybe the average buyer is just smarted in NZ?

[DaveW]

I think its better we keep to the local NZ market. Have you done any in Auckland recently Damap? Are you a kiwi dealing in the US RE market?

[spaceman]

@ POST #53

I LOL'd...... nice .....better than the cat

Cheers
Spaceman

[donna]

Damap please see your private messages - you're loading too many non- property (off topic) images on PropertyTalk. Please keep the discussion on subject.

Thank you

Donna

[Damap]

What cat images?????? I don't know what you mean?