Investment Property Opportunity Questions
Hi all!
Recently, I was presented an opportunity with a property that is gutted and in need of a renovation. This home is near Portage MI and is currently offered at 75k with an ARV of 350-400k it will need 150-175k in repairs. I am in college and only have 12k give or take to work with. I have great credit and I'm basically reaching out to the community to see what ways you would attack this opportunity. It really is too great to pass up as it is in a rural area with great schools and surrounding lakes. Literally, any advice is appreciated.
You may want to enlist an investor partner and split the ARV profits
#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
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#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
- Investor
- Austin, TX
Wholesale it for 120k. Go home with your profits
Hi Payten, it's great to see a college student turning over the stones to look for deals. I really applaud what you're doing here. A few thoughts on the deal that you're considering:
1. Deal strategy. As you mentioned, you don't have the financial firepower to take this on, so the next step is to figure out how to work this deal. I would start by trying to find a partner who has experience doing deals like this one. You'll have to think about what value you can bring to them in lieu of cash. Wholesaling is an option as other have noted, but it's generally more difficult than advertised.
2. Repair costs. I question every investor I work with on repair/rehab costs because it's a difficult thing to pinpoint, and it's the nature of rehabs that one unexpected or unnoticed item can torpedo a rehab budget. I would just urge you to do everything you can to get to a number or tight range that you are confident in. If you are friendly with a contractor, having them take a look is usually the best option. If you are able to find an experienced partner, even better.
3. Know your market. Having confidence in an ARV takes a lot of work - you have to be an expert in the market you're investing in. An investor-friendly real estate agent will be able to help you here. You will also need to know what buyers or renters in your market value as far as features, finishes, etc.
