New from Memphis

[Rob Williford]

Hey everybody!

New guy from near Memphis with lots of questions.

Here is one that I don't have an answer to but it would appear to a newbie to be a nice one.

It's a case of the worst house in the best neighborhood.
The home is 8,000 square feet. Appraised at $811,000 and foreclosed on for $550,000.

It's beautiful and its REO and not MLS listed.

What would you do and how would you do it?

This may be a broad question, but I am intrigued to no end on how to make money on this for myself and others.

Thanks in advance,

Glynn

[Jon Holdman]

Moved over to the Analysis and Advice forum. You might want to post a personal intro in the New Member Intro forum.

If it needs no work and you buy it for $485K, that will be what its worth. Not sure what you mean by "appraised at $811K", but it won't be worth anything close to that. If you mean the tax assessor has it assessed at $811K, forget it. That's a useless number. If a recent (post foreclosure) appraisal has it at $811K, it seems very unlikely the bank would list it at $550K.

What would be your plan? There's no way you can possible get enough rent out of a house to make a $485K purchase price work. With no work, its hard to see a fix and flip opportunity.

What do you mean it was "foreclosed on at $550K"? Was that the banks opening bid and nobody else bid? Then its worth less than $550K. Eventually the bank will put it on the MLS at whatever they think it might sell for. You would have to buy it and resell it at some price that would make money. I'm not really seeing much opportunity here.