Full gut rehab in Mississippi?

Question

I've been searching for rehab estimates for my area but couldn't find any relevant information online. I live in South Mississippi and have a 3/2 1500 sqft house which needs just about everything.. it does have new electric, plumbing, a new hot water heater ready for installation, and it also has brand new HVAC system. But other than these things, it needs everything. The outside does not need much work and it has all new windows. The thing i'm worried about is the property's ARV is only about 70,000-80,000. I'm trying to find out if there is any possibility of getting this property at a price which would leave enough room to feel comfortable with.

Any advice greatly appreciated!

Susan Maneck · Answer

Does it have foundation problems or need a new roof? How about mold? Those are the three things that are usually deal breakers for me.

Susan Maneck · Answer

In Mississippi building costs from the ground are only about 84sqft, so if any contractor quotes you anything in that range, I would run not walk. But if the work is mostly putting up dry wall, it may not be that expensive.

Jared Garza · Answer

Looking to wholesale it actually. But i am not worried about making a large cut on it, for all I care I could make 0. The older gentleman who owns it is extremely nice and I’m trying to help him out so that he can afford to take some vacations in his retirement. After it is rehabbed it will pull about $1,000-$1,200 a month in rent when comparing to nearby properties.

ARV is about 80,000 and from my very uneducated estimation (I pulled from the few sources I found) it’ll be about 54,000 to rehab it from studs to a nice house.

Sterling Fields · Answer

@Jared Garza are you looking to turn this into a rental? If so, what rent could you get? Or are you trying to flip it?

Jared Garza · Answer

Yeah I’m thinking it’ll be too tight to justify but I’m going to talk to some people and do the math regardless. Thank you for your help!

Susan Maneck · Answer

Oh, then we are talking real money. I have known people who have rehabbed properties from the studs but I think they did most of the work themselves. I've generally been able to buy houses which Zillow lists as having a ARV of 70-80K for about 30-35K and mostly they just needed about 5K in work. This is in Jackson. If you are by Gulf it might work. Can't see it anywhere else.

Jared Garza · Answer

The work is going to be everything interior from the studs. Insulation, drywall, flooring, and of course the big ticket items like both bathrooms and the kitchen.

Jared Garza · Answer

He is asking 23, but very negotiable. If I tell him 10 I can probably get him to sell at that. Just as soon as I do the math and make sure it’s do-able I’ll make him the offer.

Susan Maneck · Answer

How much is he asking for the property?

Jared Garza · Answer

I am not sure of the reason. It has been that way since he bought the property 10 years ago. He had the electric, plumbing, and HVAC installed but got sick and doesn’t want to deal with it. I am trying to get a good estimation of what it’ll take to get it to selling Condition. The area doesn’t call for granite countertops or anything like that, a pretty basic setup will get it to that 70-80k ARV. But 1500sqft is still quite a lot.

I found others throwing figures around like $75-$150/sqft for full gut rehab but those people are not anywheres near Mississippi. And of course the HVAC, plumbing, and electric being done knocks the price down a good bit.

75k ARV minus 30% profit is 52.5k all in. That seems really tight to me for needing a full rehab. Even if I could hypothetically get the property for 10k that leaves only 42.5k for rehab.

Full gut rehab in Mississippi?

Full gut rehab in Mississippi?

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