Updated about 1 year ago on . Most recent reply
Major renovation after fire damage
I am still searching for that first rental property. So yes, I am brand new to real estate investing. However, I do think I am pretty good with analyzing deals (for a newbie). I just havent found the property yet. I have put in offers on a couple but they have fallen through. So, with that said, this is what I am contemplating.
There is a 6 plex that was in a fire. The property needs probably close to $300,000 worth of renovations. I do believe it could be less but I am using conservative numbers. The asking price for the property is $60,000. Prior to the fire, the property was bringing in around $3,400/mo. 2 upper units were 3bd 1 ba and the lower level had 4 units that were 1bd 1ba. I would consider making this a 4 plex since the 1 bd units were very small. I believe this building could make $3,800 as LTR. I am hoping to get into the MTR market in this area. 2bd 1 ba as an MTR are bringing in $1,500/mo and around $850-950 as LTR. 3 bds are a little more.
I have been through a new build and a major renovation on my current house. So, I am not completely new to rehabs. But, the contractor that I work with, does not work in the area I am looking at. With that being said, I don't know these contractors personally.
Any and all suggestions are welcome. Is this too ambitious for a new investor?