Indianapolis, IN · Member since 2014 · 12 posts · 0 votes
I am looking at a potential REO in Indianapolis that has been reduced to a very low price because of an order to repair list. (List)
What is the best way to determine and estimate the costs of fixing the items on the list to bring it back to "investable" condition for a flip. If the repairs could be completed for under 15K I think there is a good potential for profit flipping the property and a great return holding the property.
Anyone want to look at the order to repair list and let me know how ugly this may be before I dig deeper? Looking for local advice if possible.
@Samuel George Items 1,3 and 6 can be big ticket items. It's not clear what is wrong with the chimney. If it's just filling in cracked mortar, that's no big deal. If it needs to be rebuilt, that is a big deal. Same with the foundation. This doesn't address other big ticket mechanicals like AC and furnace. You need to find out exactly what need to be done, but on the surface, I think you're looking at a major rehab.
@Samuel George Items 1,3 and 6 can be big ticket items. It's not clear what is wrong with the chimney. If it's just filling in cracked mortar, that's no big deal. If it needs to be rebuilt, that is a big deal. Same with the foundation. This doesn't address other big ticket mechanicals like AC and furnace. You need to find out exactly what need to be done, but on the surface, I think you're looking at a major rehab.
@Samuel George I wouldn't take that property if they gave it to me [it would still be a negative cash flow]!
Rough area and old, rough home. Even IF you could fix it all for $15k plus the PP of $8k for a total of $23k, you'll be lucky to get $550 rent [on occasion between vacancies and vandal visits].
Unless you have experience in this type of home I would make like Forrest Gump... and run away from this money pit.
I tried this price range of homes when I first went full time a few years back and hated it. It looks soo sexy on paper - but in realty is anything but sexy.
I always suggest everyone stay above $700 rent for single family homes and close the I-465 loop for starters and work it from there.
PM me if you need some better homes to look at. I always have a few.