Check this deal out… what am I’m missing? - Posted by jason
Posted by jason on March 22, 2006 at 14:28:54:
3 bedroom home (poss 4th, need to add closet), city lot, has all new sheetrock (needs taped/mud) i think it was to eliminate lead paint? all new windows, kitchen 1/2 way restored. Basement appears dry, although it hasnt rained in some time…basment is only 5 feet under grade…MAX. has updated electric. over 1/2 of square footage was added on in 1998.
Bank owned 15k asking (they foreclosed for 5k!!! why???). Comps in area selling for 40-55. County tax apraisal @ 45k.
Needs about 8k in work…flooring, finishing sheetrock, bathroom fixtures, roof, furnace, hot water. I will do all but install furnace/hot water
SO, 15k to buy, 10k to fix up, 1 year vacancy allowance at 250/month=3k. (I’m using HELOC, interest only. HELOC + tax+ insurance=250/month)
TOTAL 28k in the deal, assuming I can not rent it for one year. I have a friend willing to live their while working on it a bit, and pay 450/month thereafter…but I’m not COUNTING on it.
28k in it,sell under market @ about 40k, minus costs, netting me about 8k. That’s IF it doesnt rent for 1 year. Otherwise, 500/mo is easily obtainable, so it would cash flow 250/month
What am I missing? The neighborhood isnt great, but for 15k, whaddaya expect. Would be good cashflow property for a new buyer, if I have a tenant in place.