Hello BP Community,
I have my first wholesale property under contract, and had a cash buyer lined up until yesterday. He backed out at the last minute because of the septic tank. The septic system was inspected and is in perfect working condition, the only thing is is that it is a 750 gallon system that has been grandfathered into the new requirements of 1000 gallon systems for 3 bed, 2 baths. The tanks could be swapped out for roughly 6k all said and done, but that is without county permits, which i have quotes from multiple companies saying they have no problem doing it with out permits. However, if you did want permits, it opens up a can of worms because of new county requirements and setbacks. Would probably cost 20k. The cash buyer I had lined up was afraid of doing it without permits (rightfully-so), but i really don't want to walk away from this deal because the current system works great, is grandfathered in and perfectly legal as is and there is plenty of money to be made. Here are some details that might help guide advice.
Pre-manufactured home built in 1996.
Had full inspections done and passed with flying colors, even structural.
Has detached steel 2-car garage structure.
Repairs needed: paint on interior walls and wood cabinet paint. Septic if desired as described above.
Potential rent: $800/mo
Have under contract for 52k.
As you can see it could be a very simple flip or great buy and hold, so I am reluctant to just walk away, but the clock is ticking.
Thank you for your time and advice,
Wholesale, Mesa, Arizona
Why don't you get a HML and buy it yourself to fix and flip then?
Edited to say: At $20k in actual rehab by going the legal route, it is not a deal for any buyer to flip if the ARV is only $70-80k. It may work for someone who wants to buy and hold for cash flow only.