Carlsbad, CA · Member since 2010 · 1k+ posts · 1k+ votes
MODERATOR: LET ME TRY AGAIN. IF YOUR POST HERE IS ANY SORT OF AD, NO MATTER HOW SUBTLE, IT WILL BE REMOVED!
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There's been a lot of talk of sub $30k properties, so I thought it would be an interesting idea to post some pictures of what $30k buys in different parts of the country.
So here's a picture of a 2 bedroom house. I don't have the outside picture, with all the snow I just wanted to run inside the house. These are after pictures. Rent will be $800-$850. Tenants pay all utilities including lawn maintenance and snow removal.
I don't provide appliances anymore. If they are there, then we give them to tenants as-is.
But here is my finished Richmond Home (my most recent)
Just want people to know: Just because its a Working Class Neighborhood (WCN for short), does not mean you have to skimp on the repairs and renovation...I paid 25k for this property, and put about 25k in new repairs (big ticket items needed, more than I put in the past, but if it needs new anything, I repair on the front end, not back end). Previous rehabs were 10k for 35k property, and 23k for 13k rehab.
This is an excellent post @Sharad M. , because the visual does so much for people to understand whats available, abundant, and cash flows well. I'll post more tonight.
Investor · sacramento, CA · Member since 2013 · 39 posts · 13 votes
12y
There's been a lot of talk of sub $30k properties, so I thought it would be an interesting idea to post some pictures of what $30k buys in different parts of the country.
i can't put a picture here , because you might be able to but a Restroom with 30K in Sacramento , CA .
there is no house with that kind of price in My area , you should feel lucky .
also from the pics i can tell this is a good property for under 30K . really worth it .
Investor · Southeast, MI · Member since 2012 · 2k+ posts · 1k+ votes
12y
Here's a house I bought last month in a B neighborhood for $31K. It sold 10 years ago for $103K. I picked it up on a short sale.
The only work that was done to the kitchen was paint and floor. The appliances were already there. The bathroom has a jetted tub and all the tile work was like that. I replaced the vanity with a $69 special from HD. The one that was there was super fancy with a granite counter. I'm taking it up north to my lakehouse that I'm remodeling. I installed a grid drain in the sink because I con't like pop ups and removed the garbage disposal because they are a nightmare when tenants are involved.
The house was built in 1989, so not as old as most in the area. I paid the painter $700 for labor, flooring was $1,000 (labor and material), $600 to gut out the basement that had been poorly finished, and $300 for glass block windows in basement. The house needs a new roof ($2,600). Was supposed to be replaced by now, but we've had the worst winter in history. Should be done next week.
I have it up for rent for $895. Have had a few calls, but it's slow right now with the cold weather and record breaking amount iof snow we've had. So far, two people want to see it this Saturday.
A little over $30K. Will be up around $37K when all said and done.
Carlsbad, CA · Member since 2010 · 1k+ posts · 1k+ votes
12y
@Sam Hadad Fortunate that we have this great investment opportunity here in this part of the country. I have a friend who lives in S Cal and he and I were talking about the houses that I am buying and now he wants to help him buy one. He couldn't believe the prices and rental return.
@Peter Hanson What do you mean that nothing has rented there in last 3 years? Is there something wrong with the area? Can you tell us more about it.
Investor · Southeast, MI · Member since 2012 · 2k+ posts · 1k+ votes
12y
@Sharad M. These deals used to be more plentiful, but are getting harder and harder to find. This house was for sale for a long time and listed at $39,900. I looked at it last year. It was a short sale and had tenants (hoarders) with a huge dog. At the time, I passed on it as I was finding better deals. Now a couple months ago, I noticed it still for sale. Our market has gone up a lot, so the price was a lot better. I emailed the listing agent to see what type of lease the current tenants had and what breed of dog. She responded that the house was now vacant and acted like I should have known that since the MLS listing was changed, but it wasn't changed.
When I clicked on the link for public records, I saw that the house had gone to sheriff's sale on the first mortgage. In Michigan, we have a six month redemption period. The redemption amount was only $28K. The second mortgage was owned over $12,000, but they settled for $1,000. The seller had to send money to close. (They now live out of state). We had to close by the end of December because they wanted that debt relief deal that expired at the end of 2013. We made it just in time.
I've had several short sales go through and others that fell apart. It's all a numbers game.
Real Estate Investor · Saint Petersburg, FL · Member since 2013 · 1k+ posts · 951 votes
12y
Here's a duplex I bought last year,two 1 bed, 1 bath units 510sqft each.
Paid $11k plus $3k in attorney and title company fees to get the short sale through (previous purchase price was $130k in 2005). I spent another $10k on my rehab and it's rented for $550/side.
But here is my finished Richmond Home (my most recent)
Just want people to know: Just because its a Working Class Neighborhood (WCN for short), does not mean you have to skimp on the repairs and renovation...I paid 25k for this property, and put about 25k in new repairs (big ticket items needed, more than I put in the past, but if it needs new anything, I repair on the front end, not back end). Previous rehabs were 10k for 35k property, and 23k for 13k rehab.
This is an excellent post @Sharad M. , because the visual does so much for people to understand whats available, abundant, and cash flows well. I'll post more tonight.
I agree that visuals make it so much easier for people to understand what kind of properties we are investing. These are not run down properties, but good solid properties in WCNs.
Like I said in one my other posts, people at all income levels need good housing. It doesn't cost me a lot more to do a neutral color and paint trims white and make the house stand out. The tenants appreciate it.
I provide my tenants a nice, clean place and they usually have no reason to leave unless there's a major life event like divorce, change in jobs, etc.
@Rob K. - Same in my market. There are still good deals, but a little harder to get.
@Patrick L. - Are your properties in FL? Great numbers and very nice finishes.
@Bryan H. - Excellent deal!! Are you out of state investor in Detroit? That's a very nice deal you got.
Real Estate Investor · Saint Petersburg, FL · Member since 2013 · 1k+ posts · 951 votes
12y
@Sharad M. Yes those properties (and all of my rentals) are in the Tampa Bay area of Florida. I've been able to find great numbers locally without having to deal with trying to invest remotely.
Investor · Southeast, MI · Member since 2012 · 2k+ posts · 1k+ votes
12y
Here's a two bedroom I bought for $4,800 in 2009. I put $1,200 into it and it's been rented for $590. When I bought it, it just needed paint and carpet. I had two guys paint it in two days for $10 per hour. I did have to replace the roof two years ago for $2,200. My copper pipes were stolen between tenants also. The only time that's happened to me. The house had newer vinyl windows when I bought it.
Still a good return. Not in the best area, but I don't go there after dark.
Carlsbad, CA · Member since 2010 · 1k+ posts · 1k+ votes
12y
@Patrick L. - Great stuff!! If you can get those kind of returns in your local market, no need to go anyplace else. Are there still plenty of similar deals in your area or is it much harder to find deals like those?
@Rob K. - So about $10k all in for $590/month in rent. That's unbelievable!! Since 2009, how long has the property been vacant for?
Real Estate Investor · Madison Heights, MI · Member since 2014 · 693 posts · 216 votes
12y
The house I am living in right now I paid 35k for. It was move in ready if we wanted it to be an old lady house. That's not how we do though so I fixed up the kitchen finished part of the basement and will have all rooms freshly painted by the time we want to sell it in a year.
We could rent it out for 850 all day long. Its a 3/2/2. It had a fridge, gas stove, washer, dryer, garbage disposal, hard wood floors with coved ceilings. On a corner lot with a nice vinyl fence. All mechanicals worked just fine.
@Rob K - So about $10k all in for $590/month in rent. That's unbelievable!! Since 2009, how long has the property been vacant for?
Less than $10K. It barely needed any work. It was vacant for two months after I bought it, two months after the first tenant, and one month after the second tenant. Paint and carpet haven't been changed since 2009. When these current tenants move, it will probabky need to be replaced.
Clearwater, FL · Member since 2013 · 46 posts · 10 votes
12y
@Sharad M. I'm really digging this thread, definitely more of a visual person. Thanks for sharing.
@Lisa Phillips Is this in Southside? I've noticed a lot of activity here and downtown and was thinking about marketing for wholesale deals in the area. Looking forward to some of your other projects.
Real Estate Investor · Saint Petersburg, FL · Member since 2013 · 1k+ posts · 951 votes
12y
@Sharad M. These deals are still possible in my market, just a lot harder to find. A couple years ago I could pick up stuff under $20k all day long and now it's harder but there are still deals if you hustle.
Here's one more, one of my favorite cheap purchases. $16k and a $1.5k rehab, we didn't even paint it and the appliances were all there at the time of purchase. Just fixed a few plumbing issues and replaced the outside A/C unit. I had to dig up my pictures for this one because it's been occupied for the last 3 years at $850/month so I haven't had to advertise it in a while.
Real Estate Investor · Arlington, VA · Member since 2012 · 300 posts · 277 votes
12y
@Son Huynh, Yes, I think they do refer to it as the southside. Its south of Virginia Commerce University, off of Jefferson Davis. If you stay out of the projects (this one area about 1.5 mi away that is bad enough for me not to invest in), its FULL of great neighborhoods and property. If you want to know one method of finding them in Richmond, you can check out my Leveraged Analysis Technique. That's what I use, it works really well.
@Patrick L. I know where Im going next!!! :-) J/k, I don't have to go that far to find a WCN. They are literally everywhere, sometime you just have to drive and hour or two to get there.
@Rob K. Don't go there at night either, but that's only because that's what property managers are for ;-)
Carlsbad, CA · Member since 2010 · 1k+ posts · 1k+ votes
12y
@Rob K. - That's great that you have had only 5 months of vacancy in last 5 years, so pretty much on track with an average one month of vacancy per year.
@Account Closed - You're welcome.
@Bryan H. - How are you handling the management? You must have a great management team in place.
@Patrick L. - That's another awesome deal. 58% gross return!!