What to do with this property? sell / rent

SCORE! I just got a really nice condition foreclosure SFM.
I close on March 29th.

Tax Assessed value $77,000

Purchase price $30,000

It is a nice 4 bedroom, 2 bath home with 2 stall garage in a nice neighborhood close to everything. The home has a nice layout with nice big rooms and closets.

It is in amazing shape for the price. The only thing I saw it needs is the interior wood on the windows had some peeling paint. The outside had nice steel siding and newer window storms. The garage also needs a new paint job.

I currently have 7 homes. I have had up to 10 since the year 2004. My other homes are rented except for one that I have been remodeling for over a year.

I think the tax value is very close to the real market value. I am going to pay cash for the home. But I do not want my cash tied up for too long. I have a new boat to pay for of $30,000 on April 27th.

I would like to try to get $64,000 for it. What is the best way to sell this quick? Start advertising now? It was advertised by through the MLS for the first month at $48,000 before that it was at $57,000 for a month. But we are in the middle of winter here with 3’ of snow to the house so not many people had looked at it. I found out a few weeks later within minutes of the change that the price dropped to $30,000 and I immediately put in my 3rd and final offer, found out later there were many calls on the property the day my offer was accepted.

What is the tax hit of flipping right away? Should I rent it for a year? I am a little fed up with renter problems at the moment and would like to make some fast money!

I will put the property in my XXXXX LLC company name.

all advice welcome

Even with the weather I can not imagine that big of a price swing without major work but I don’t know your market. If it works out great pick.

Taxes on the profit from flips are treated as capital gains. Short term if you keep it for under a year. As for keeping for a rental it might be hard to get your cash back out right now.

Why are you pressuring yourself with the boat, what is the worst that can happen, you finance the boat and pay it off when the dollar train comes in.

I don’t know where this is. I know from the price it isn’t NYC. At the price your asking your buyer will likely be an end user, and will have to get financing so you can get your bucks out of it. And if your taking a year to redo another property I wouldn’t bet that you will get this one into retail condition any time soon.

Ever own a boat before? I have, and the old saying that the 2nd happiest day of your life is when you buy your boat, the happiest is when you sell it, was true for me.

Sell/Keep as rental decision…

I second what Brian said. Two happiest days in a boat owner’s life are the day he buys his boat, and the day he sells his boat. In our case, we had waverunners twice. Once before kids, and once after. Both times, lasted a couple summers until we were hardly ever using them, and wasting garage space, and decided to sell. Take up space, take up money, take up time. Upkeep and care are way more work than most people realize. Other than for serious, avid boaters/fishermen, I suggest rent a boat whenever the urge to be on the water overcomes you. Putting the money into an investment other than a boat should easily give you enough return to pay for renting a boat now and again.

Keep/sell decision is really personal. I keep because I love the benefits of rental property, hence the reason I am up to 36 houses and counting.

Lastly, if you are taking over a year fixing up a house, doing the weekend warrior thing, you really need to improve your approach. Hire a good, professional contractor or handyman, knock the work out, and sell or rent the house. Ten months worth of rent lost while you pretend you have enough time to fix it yourself probably pays for all of the labor you hire. Also, if you are going to leave the new purchase sitting empty while you finish the one year fix up house, then fix up the new purchase, probably makes more sense to wholesale as is and make a few bucks. IMHO, empty houses are not nearly as good an investment as rental properties (that have rent coming in) or quick flips (emphasis on quick).

Best wishes,
Chris in FL

P.S. - If it sounds like I am mocking you, that is not my intent. Maybe there are factors I don’t know about, like you can’t find a way to come up with the money to fix the house in less than a year. I do want you to realize, if you study successful real estate investors, you will not find any that take a year or more to fix up a house. That is a hobby. Is your intent to invest for profits, or have a hobby? Figure that out, then structure your deals accordingly.