Low End Rehab Questions

[David Humphrey]

Hey everybody,

Had a quick question to gauge the opinions of BP. NO holds barred, let me know what you think.

There are a large number of $12-15k properties in my area that need $10k worth of work on average.  ARVs in the $40-45k region.  I'm not looking for a critique of the numbers though.

These houses aren't in the best areas, and would be a rehab/rental that I would sell as such.  Working class poor is what I would describe these neighborhoods as. These would be hands off projects.  Is it worth the time and effort to get these properties, or do you think that generally landlords would do this themselves?  Just asking for some advice on a tricky area of the market.  

Thanks to everyone in advance!

PS.  Rents would be in the $600-700 range.

[Jay Hinrichs]

@David Humphrey 

  I believe the locals who specialize in owning this asset class with just do it themselves. I don't see a lot of value add for you to buy and rehab and then resell basically turn key.

the profits when you do the Turn key come when you can sell to out of area folks who cannot do this on their own and will pay a premium for your service. but you MUST have PM set up and ready to go for them so on and so forth.

Now one thing you might consider is creating a type of JV deal with local professionals that are looking for passive cash flow you set up a company and you bring them in as cash partners you do all the work take an equity ownership.. charge an up front fee for facilitation then either you manage the manager or since your an owner and if you love dealing with tenants you manage them for a fee. That could work in your area..