Re: Cash flow on abandoned property? - Posted by HankM
Posted by HankM on March 05, 1999 at 11:35:40:
I’m a little confused … on one hand your rehab numbers seem REAL HIGH … on the other hand you say you’re a contractor, so I assume you know what you’re doing. All I can say is you’re doing too much to the property.
I figure something like this … fix code and structural defects if any … nice kitchen (not gourmet), nice bath … floor finish (carpet or sand) paint and clean … now there will be some drywall and plaster needed somewhere, but I can generally get all that stuff done on a 3-4 br 2 bth for 12-17K … less than half what you are estimating.
Also, it seems that you might be trying too upscale an area … 1800/month is a lot of rent … maybe that explains why you need to spend so much (the market demands it) …
A real deal I have just bought … cost $60K … I’m doing everything above with an estimate of 16.5K … after which I expect to get $100K … netting maybe 15K is I sell with a broker and after my holding costs …
that’s what I do, i wouldn’t dream of holding a rental … but that’s just me.