Omaha, Nebraska Flip Opportunity????

Question

I've been researching properties in Omaha, Nebraska and came across this property at 12931 Laurel Avenue, Omaha 68164.  They just did a $60k price reduction and now have it priced at $100,000.  It looks like a great deal.  I'm not ready to pull the trigger, so I'm happy to put it out to the community.

To those investors and agents who are active in the area, am I on the right track?  Would this make a good Flip or BRRRR?   And if so, what price would you come in at with an offer?  Also curious if anyone would share an opinion about the neighborhood.  Thanks in advance!  I look forward to connecting......

Kyle Godbout · Answer

@Joe Gummerson

I have one about 2 houses down from that one that rents for $1375 right now. Unfortunately this house won’t sell for that. It will be a multiple offer situation, probably with offers using an escalation clause. This is in the description:

Investor does not intend for house to sell at 100,000 we will be expecting multiple offers. Escalation clause is encouraged to be included in offer. Property is being sold in as-is condition. We will be showing the property on Sept 4th from 12PM -3:30PM only. All agents/clients required to wear masks & gloves upon entering home. All offers to be submitted by Sept 7th by 8PM. Seller will review offers Sept 8th at 10AM.

Joe Gummerson · Answer

Ohhhh, Thank you Kyle.

That information was not provided on Zillow.  Thank you for the insight.  Just curious though, would that have been a great buy at $100k???

Gary Parilis · Answer

Wow, that's a deal. You'd better investigate why the price drop. I haven't looked at comps, but this looks too good to be true. They bought the property in 2016 for $146k. I'd recommend doing some investigation to determine how much they owe on it.

By my calculations, you'd be at about 18% cash-on-cash ROI.... With a whole lot of assumptions.

Rentometer suggests rent would be about $1400.

If you put 25% down, your cash spend (incl closing costs) would be around $30k.

Monthly net income after repairs, vacancy, mgmt, lease fee, mortgage, P&I would be around $450. Annual around $5,450.

5,450/30,000=18%

Personally, I'd be suspicious, but if it checks out, I'd buy it in a minute. I wouldn't flip it, though. It would pay for itself in 5 years. Would you rather take $50k or so now (minus taxes) or own a $150k property free and clear in 5 years?

Don't take my calculations at face value. Trust your own analysis.