Investor question: Do you pay full market value?

Do investors ever pay - cash - full market value on properties? I see ads that say they do but can't imagine why they would do this? Does anyone know? With the market the way it is I don't see how they would make any money.

I would not pay more then 60% of market value.

They don't pay what you believe is full market value. They pay a very low price so they can fix it up and turn around and sell it for a profit. I guess they are saying that the market for investor purchase is X amount and you believe the market value is X plus 40% or maybe 30%.

I've not seen these kinds of ads in Venice, Florida, but in a buyer's market it is rare for anyone - investor or end user - to pay full list price, or sometimes even full market value. These days, the market value is one thing - the price to snag a buyer is another.

For example, with a house that has been "comped" at $200,000 based on recent sales of comparable homes (nearly the same age, square footage, upgrades, neighborhood, etc.), there may be literally hundreds of houses in that price range for a buyer to choose from.

To bring a buyer in a tough market like that, a seller may have to list that house for less than $200,000 - say $195,000 - to come in under the pack and get some attention.

Right now in Southwest Florida, the investors are back because prices are terrific - and they know that properties in Florida, particularly in beachside communities like Venice, will rebound at some point and get back on the appreciation track.

So, they might buy now, while prices are low, rent it out, and count on a profit in the future.

Or live in it, enjoy it, and use it as a primary residence for at least 2 years so they can hopefully sell it at a profit and still fall under the protective capital gains umbrella.

Not every investor is a flipper, and many flippers have been stung recently, as you know.

In my mind, real estate should be a long term investment, whether you are an end user or an investor.

No, never cash for full market value. They probably give you low comps and minus cost for repairs, real estate commissions you would have paid, etc.

Regards...

'Full market value' is a very subjective term... remember, when you see these ads... their only objective is to get you to call, so they will put almost anything in them to get you to do so...

Normally investors look to buy property below market value. That's the whole point, unless they are going to use it as rental property. If its's in a desireable neighborhood and they buy it at market value, then they could probably make some good monthly income on the property. An example would be buying a multi-unit property at market value for the purpose of the residual income; with the hopes that the property will appreciate in value over time.

I have a feeling you have a house sitting on the market and not selling...
Why would an investor buy it for FULL price? If you contact one of them, they'll buy it, but for MUCH less than market value. This is how they make money and, by the way, there's nothing wrong with this. "Buy low, sell high" is an old formula.
Why do they advertise "full market value?" They'll give you a million reasons why YOUR house cannot be bought by them for full value...