It comes down to research. I cannot tell you how many properties I walk through where the home is being sold half rehabbed. Meaning, the seller purchased the property with the intent of "flipping" and ran out of money. The first thing that comes to mind is they never penciled their numbers back. Just because you buy an ugly house does not mean you are going to make a ton of money by fixing it up.
Typically before I make an offer (on any property), I search the seller looking for distress and call the listing agent to get a read on the situation. I am looking for "Motivation" from the seller. I make a lot of offers on short sales where the lender is forgiving a certain amount of debt against a property because the seller is insolvent and cannot pay closing costs. With these types of deals you have to be patient because the lender can sometimes take up to 30 days for a response. I have had quite a few offers get accepted in the last month where I had my doubts. I never make an offer based on what the seller is asking. I determine the value for the buyer and encourage the buyer to make a "less than" offer. Most sellers have a "low ball" number in their head where they are willing to reduce their price to. My goal is to find the number and push them a little beyond. In the last month, I have had offers accepted tens of thousands less than asking.
I have several buyers tell me you can't find deals on the MLS. That is true if you don't know what you are looking for.
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