What can I do with this junker? - Posted by Mike M. (OH)
Posted by Mike M. (OH) on December 01, 1998 at 22:29:10:
Hope everyone had a great Thanksgiving! I haven’t been on here for awhile. I have been (like a lot of people) working my boring 40hr/wk job making pretty good money, and not spending my time working to make REAL money.
Anyway, as my lease is up Feb 1, I need to find a house quick. I’ve been sending out faxes to all kinds of realtors on cheap houses in the area I need to live asking for comps, loan/lien info, repairs needed, seller’s motivation, etc. So I was talking to a realtor, mentioning that I’m a part time real estate investor and he asks if I like houses that need repairs. Of course I do. Repairs almost always point to motivation. So here’s what I found:
The house is in a good, low crime, small town in the suburbs of cincinnati. It’s about 1200-1400 sqft, originally a 4bdrm, 2ba, partial basement, easement on the side of the house for a driveway (and poss garage). Small lot in the village, and it was originally a duplex. It’s totally gutted, down to the studs. No elec, hvac, kitchen, plumbing, nothing. But it’s ready to be put back together. I’m guessing I can get it for about $18-22k. Comps for similar sqft are about $70-95k in the immediate area. It’s a nice place that I wouldn’t mind moving into, but I would need to have it “livable” by feb 1.
Am I totally crazy? I would have to get a loan based on the fixed up value of the house and mess with escrow. Then I would need to hire subcontractors to get in there and put the plumbing, electric, heat/cooling, and walls in. Does anyone have a ROUGH guess how much it is going to cost to totally put the insides back in? I could have the place fixed up, keep my monthly payments low, and sell it in a year or two at retail for $85k, or even lease option it for $3k down, $799/mo $90k option price.
Or my other option was to get it under contract for $18k, and turn around and flip it to another investor for $25k and find something else that needs less work.
Thanks in advance!