How we make offers

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First and most importantly, we honestly believe it's in our best interest to give you the best possible offer.

We stay in business and support our families by making offers that get accepted. The only way to do that is to give you an offer that you're happy with.

Here's what we know: Low-ball offers don't do anyone any good.

The process we use to figure out your offer price is laid out below for you to see because making you comfortable with everything we do is our highest priority.

So, here's the most important thing to remember: Our Offers Are Based On Your Home's "After Repair Market Value"

This is the number that once your property is renovated ( to "HGTV" standards, as we call it) and fixed up, it would sell for. Every offer we make is based on a simple calculation.

Here's an example of how it works -->

You have a house that you want to sell. You know that two houses in your neighborhood recently sold for $175,000 and $172,000. These homes are roughly the same size and type as yours but they've been recently updated. The usual things - new appliances, flooring, granite countertops, brand new bathrooms, roof, windows, etc.

This tells us that if we purchase your property and make similar updates (which we always do over the course of making a beautiful rent-ready home for a local family), we can expect the value of your renovated property to be right around that same $172-175K mark.

If we know what the property is worth once its completely rehabbed – AND we know what things your property needs to have fixed/updated/repaired, then we have everything we need to determine an offer price for you.

Our process is based on math and market conditions – not some random formula, and not how desperate you are to sell.

A more detailed look at the process

OK, so here's the math part:

YOUR OFFER = ARV - Cost of repairs needed – Closing and Holding costs – Profit margin

ARV stands for "after repair value" and is the amount the property is worth once all repairs and updates have been completed.

Cost of repairs needed are the funds we expect to put into the property – new kitchens / baths / flooring / paint / permits / plumbing / electrical /etc.

Closing and holding costs include title insurance, utilities, transfer taxes, property taxes, etc. These are the fees you do NOT pay when we buy your house from you.

Profit margin. While this may be self-explanatory, we need to stay in business and pay our team. But, we strive to keep these margins as reasonable as possible. I would rather buy many properties with little profit margin than one or two properties where we make a large sum of money.

This comes from our belief in a better way to do business.

For this reason, we have no problem sharing the exact numbers we use to calculate the purchase price we prepare for you.

Let's look at what our fictional property might need:

For example, let's use a home built in 1975, and no major updates have been done since then.

Our example house is in pretty sound shape. The structure is good, but going back on the market as a beautiful rental property, it will need some updates.

For sure, new flooring and paint. Likely a brand new kitchen and bath to bring things up to standard.

It may need an updated electrical panel to comply with newer codes. In addition, the plumbing will often need to be changed from the old galvanized style to copper. There will be lighting fixtures, new doors, possibly some windows needing to be replaced.

Let's look at actual numbers from one of our recent purchases to fix all these things.

New floors - $4500

Interior and Exterior paint - $3500

New Kitchen (cabinets, counter tops, appliances, etc.) - $15000

New Bathroom (tub surround, tile, toilet, vanity, etc.) - $8500

Updated Electrical System - $2500

Updated Plumbing - $2500

Misc Lighting Fixtures, Doors, Carpentry, Debris Removal, etc - $4500

Permits to complete the work - $2500

TOTAL REHAB COST: $43,500

Let's say our Closing/Holding costs are roughly $2000 (these tend to run about 10-15% of the ARV).

And our minimum profit on a deal like this is $14,000.

Let's look at these actual numbers in the equation we listed above:

ARV($175,000) – Cost of Repairs Needed ($43,500) – Closing and Holding Costs ($2,000) – Profit Margin ($14,000) = YOUR OFFER $115,500.00

That $115,500 would come in the form of a cash offer for the fair market value of your property in its current condition.

If we agree on the numbers, we go to closing, you get your check, and the deal is done.

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Giving these kinds of offers helps with our mission

If you've read our mission, you'll know that we believe in the power of helping families get homes. The simple math for us is that the more homes we can buy, the more homes we can fix up and offer back to local families.

Giving the members of our community a place to make their own, one in which they can live the good life.