This Detroit “Light Rehab” Turned Into a $25K Disaster

Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes

An out-of-state investor bought what the seller described as a light Detroit rehab with roughly $8,000 in repairs—but the real number was closer to $25,000. In this video, James Wise explains how major electrical, plumbing, roofing, and property-condition problems can turn a cash-flowing rental into a money pit when investors rely on bad estimates instead of experienced local professionals who know what to look for.

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Leroy K. WilliamsPro Member
Property Manager · Southfield Mi · Member since 2018 · 190 posts · 174 votes
2mo
If the majority of investors were simply sober when deciding what to buy and where to invest, they would avoid the money pit calamities. That said, if these same investors were fair and loyal to their service teams they wouldn't have to face these money pits alone. The right team will absorb some of the misfortune for the sake of the operation.
We scout properties for clients to sort out potential money pits. Once the decision to buy is made, a scope of work is established, and a project budget is assigned, we fight like hades to keep the cost right where it is set or at least in the same ballpark. Surprises or not.
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- James Wise
  OP
  Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes
  2mo
  Quote from @Leroy K. Williams:
  
  If the majority of investors were simply sober when deciding what to buy and where to invest, they would avoid the money pit calamities. That said, if these same investors were fair and loyal to their service teams they wouldn't have to face these money pits alone. The right team will absorb some of the misfortune for the sake of the operation.
  We scout properties for clients to sort out potential money pits. Once the decision to buy is made, a scope of work is established, and a project budget is assigned, we fight like hades to keep the cost right where it is set or at least in the same ballpark. Surprises or not.
  
  "...That said, if these same investors were fair and loyal to their service teams they wouldn't have to face these money pits alone..."
  
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