just sold my first sub 30k house in cleveland
so, after a lot of reading on bp about the dificelties of a profit from a sub 30k house- i had to test it myself. the numbers on paper were just too good.
button line- we've lost money on our first house. but, we have learned so much- that the next one will be very profitable.
the highlits:
my brothers and i bought a 18k house in a neighborhood of 50% ownership, no Abandoned houses- but still a rough neighborhood. the house was broken into 3 times! (they cut copper and wires)
we put in to it 1 month of self work (learned from youtube) plus hired a professional (for the shower and kitchen) at total of 20k.
we sold it just now for 35k (lost 7k)
the good thing is that i can notice the mistakes:
1. we've upgreaded the elctrical sistem at a bout 4k. most buyers dont care for that and it cause a lot of holes in the old plaster wall (much worse the dry wall)
2. we didnt paint the outside- thinking it less important (its very important)
3. we used stick on tiles instead of vinyl floor (1 days extra work), replaced windows that were old but not in a bad shape and a few more extras there and to littles here...
4. to stress to buy (we were not local and had a flight back home) and to sell (we thought the snow slow the market down- its not so true)
to summaries it:
dont buy a house with electrical issues, bad windows, and rough exterior.
dont be afraid from holes in the walls, old paint or pluming issues- those are reliability easy to fix and drop the purchase price dramatically.
now we will buy 2 more houses with a purchase price of 12-20k, remodeling budget of 8-10k.
we predicts a 15k profit on a flip and 20% roi on a rental (1 house for each niche)
i leave you with some pictures