Real Estate Broker | Investor | Property Manager · Plantation, FL · Member since 2015 · 228 posts · 68 votes
Here are my numbers on a 1350sf 3/2 I found:
purchase price: $60,000
Rehab budget: $60k
Holding & hard loan costs: $14,000
Sale closing & Realtor fees: $11,000
ARV: $199,900
Possible profit: $54,900
I am assuming the kitchen and 2 bathrooms need a full redo as well as painting/sealing the driveway a day some new floors. I could possibly get everything done with a lower budget but prefer to be prepared.
Thoughts?
Also, does anyone have a good excel sheet or Web calculator to double check hard money costs?
There are 2000sf homes 2 blocks away that have sold for $280k but mostly it is an inexpensive neighborhood. Maybe I'm pricing ARV too low...
Investor · Fairfield-New Haven-Hartford County, CT · Member since 2013 · 825 posts · 413 votes
10y
@Kevin Kohler from your assumptions, this looks like a very good deal.
The only thing I noticed is that the 3/2 house that you are pricing out at $200K is 1,350 square feet ($148/SqFt); and the homes that you're saying sold for $280K are 2,000 SqFt ($140/SqFt).
Often times smaller homes do have a higher price per square foot, so your analysis may be spot on. However, some times smaller homes may NOT have a higher price per Sq Ft in which case make sure that you are comping similar homes.
For approximate HML costs, you can multiply the principal amount you intend to borrow ("P") x interest rate ("I") x time ("T") listed in amount of months divided by 12 [e.g. 6 months/12 months] + Points (as a percentage] x Principal borrowed.