Rehabbing Your First House

[Account Closed]

I know many of you may have seen the topic and thought about your first fix and flip. I actually would like to get some of your opinion's on rehabbing my first home to live in. Let me explain. My wife and I are getting ready to buy our first house and we are going to rehab it and live in it. We are getting an FHA 203k loan. We'll be able to include all renovations in the mortgage and can use any amount on repairs as long as the value after the work makes sense.

So the way I see it we can pick up a nice place at about 65% of arv less the repairs and really do an outstanding rehab heres an example using my last deal's numbers.

I find a place with an Arv of $380k
I buy the place for $175k
To do a regular rehab might be about 60k but say I wanted to put about $100k into it. I would be into this place for about $275k and have a spectacular looking house. one of the best on the block. And im stil about $100k below fmv. I'll have an amazing house with a ton of equity that I could live in very comfortably. Does this make sense?

The second part is how i manage a task like this and how we shoupd screen general contractors. My wife and i have a vision for what we want our house to look like but with this type of a project we want to make sure we're careful and get the most bang for our buck. Any thoughts from anyone familiar with rehabs? Do contractors usually have vision or do i have to design every detail?

[Kama Ward]

Here's my idea: Do a rehab to sell first. You will learn sooooo much that you just can't learn unless you actually do it. You won't be as uptight since you won't be living there- maybe you will have fewer disagreements with your wife too . You will learn codes, order of operation and rhythm of rehabs. You will hopefully have some good contractors and definitely have ones you will never hire again.

You will have a better chance of getting what you actually want and/or can really have in your home. Your wife will have her head out of the HGTV clouds. Everyone I know who has done their own home as their first major rehab either says "I would do so many things differently" or "I will never do this again".