Updated over 8 years ago on . Most recent reply
Newbie starting out in Houston
Hi BP nation,
I would like to get some advice or confirmation of these jitters i have for a deal i am about to enter.
This would be my second acquisition of an investment property here in Houston. The first being what turned out to be a turn-key property. The original owner decided not to rent but flip for quick cash to pay for some medical expenses. I came in and purchased at market value because it had great cash flow potential.
This next home is a project, a bigger one that i have not experienced. I got the deal from a local wholesaler who befriended me and am very grateful he even has the time to talk to me about his 20+ years experience. It is a 4/2/3 in a blue collar area, Pasadena, TX. The area has good rentals and a good amount of homes have been newly remodeled. Most homes in the area were built in the 50's. Like a lot of Houston homes, the foundation is damaged, which in turn damaged the rest of the house. The plumbing, the roof frame, the sheet rock. The previous tenants decided to take the A/C unit and all the wiring. There is an add on master suite that needs to be repaired. Of course the electrical most likely needs to get updated.
I have a HML all lined up to finance with. I called out an inspector and he basically confirmed what i had already deduced, needs work. The numbers are good from what i can tell. the comps are in the $90 sq ft for recently sold homes on the MLS. I am getting this one for $44 sq ft. Even after rehabbing cost, i would be all in at $63 sq ft. But i am just nervous as all get out! Its fear, of the unknown. What i know about the deal doesn't calm me. Its the lack of experience, the risk that i am taking, even when i know the goals that i have set tell me that i need to take that leap if i want to succeed. In my mind i can hear @BrandonTurner tell me "just start", while @JoshDorkin says, "uhh, i don't know man, you sure about this?" I have heard almost all of the podcast that my real estate consciousness sounds like them! I have done a lot of deals on paper, and some i have moved on only to be too slow to get the bid. Its been two years of just window shopping, writing yellow letters, and driving for dollars. I didn't feel this nervous the day i got married, this is worse. (not the marriage part, but the anxiety that i get from thinking that this could be the one that gets me in the game) I love my wife!
My question is if this is excitement or fear? And can anyone relate? Thanks