Vanilla Ice Project Season 3 - ARV Reality Check
I thought some of you might find this interesting...
I've been watching the Vanilla Ice Project, which for those of you who don't know it's a show that follows former 90's rapper Vanilla Ice (Rob Van Winkle) as he and his crew fix and flip a house.
On this season he bought a property in Lake Worth, FL which had been sitting vacant for quite some time. It's a 4 bedroom 3.5 bath home, about 3,500 sq ft, on a 1.3 acre lot on a small lake.
It was entertaining for me to watch because I LOVE this stuff. With my interest in real estate investing and the fact that I grew up watching shows like This Old House and The New Yankee Workshop, I just can't get enough! Anyway, I'll spare you my life story and get to the good stuff.
So what was the outcome of Vanilla Ice's flip you ask?
Well, on the last episode of the show, which aired yesterday 4/28/13, he had a huge party and an open house. Then he briefly went over the numbers. He claimed to have bought the house for $325,000. He said he put over $500,000 into repairs and would list it for 1.3 million. I wanted to see if the house had sold because I know these shows usually air well after they are shot, so I did a little Googling and I found the address of the property.
According to Trulia.com it was indeed initailly listed on 2/9/13 for $1,299,000. Then on 2/12/13 it was dropped $368,000 to $931,000 and as of 4/5/13 dropped another $100,000 to what it's presently listed at now, $831,000. A little quick math based on what Vanilla Ice himself said means he has over $825,000 into the property. Either the $500,000+ he claimed to have put into the rehab was TV puffery or he seems likely to lose on this deal.
A cursery look on Trulia.com at other proprties in the area would make one wonder how anyone would come up with 1.3 million as an ARV for this property. This brings to mind something I recently heard Ben Leybovich say on podcast 14 @34:20 http://www.biggerpockets.com/show14. In essence he said with single-family homes you can't increase the value you can only bring it back to the value the market has set, which is based on a comparative analysis. He said you can make it the taj mahal. You can put gold toilets in it, but you're not going to overcome the price the market sets for that particular location and size of property.
Let me know what your thoughts are?
If anyone is interested the property address is: 4240 Foxview Ct
Lake Worth, FL 33467. Here's a link to the record on the Palm Beach county property appraiser's website: http://goo.gl/f09Xs