BiggerPockets

Hello, as a newer investor in the DC area, I need some advice on a totally burned out property. Getting postcards ready to mail to 15 homeowners out of about 40 properties. My plan is to birddog some/ wholesale others. I'm still compiling my wholesaling/ buyer/investor lists. Prop. Description: 2 story, br. row, w/attic, eng. basement, 3br 1.5 baths I didn't see the rear, or inside damage. It's an inside row house so I'm hoping that the structure is still sound. All the front side openings were covered with plywood and it probably needs a total rehab. It's in a neighborhood that is currently being renovated. $335k - $350k arv last sale 2007 = $350k Depending on the level of rehab, $400k I have an investor/with construction co. as a possible buyer. My questions; Would the fire insurance have paid a decent portion of the remaining mortgage balance off? whats the deal structure? What do I offer for the property? Thanks in advance.

Just my opinion here. If you're a new real estate investor, I hope you have some construction experience.

You need to know what you're doing with burn outs and more importantly, the people you hire to do the work better know what they are doing.

My advice is to start with a small project. Look for cosmetic flips, even if the margins are smaller, your level of risk is also very attractive.

You can never tell what the insurance covered or paid off when working with burnouts, you just have to know what other investors are willing to pay. The house will have to listed or sold at a huge discount anyways. First thing would be following jawsette's advice and check local codes and regulations. Assigning a contract could be tricky if you become liable for the property while it is being condemned.

The thing that caught my eye is you were using a comp from 2007. Understand that that comp means nothing. You need to use comps from this year and really no more than 6 months out max as a good indication of current value. I used to use comps going back 2 years but these days you can't.

Goodluck

I dont think he is using it as a comp. He is telling you what it last sold for (still does not matter).