Help on rehab costs (with link and video)

[Eliot M.]

Hi everyone.  Was looking to hopefully get some help from you rehabbers on this possible deal in my near future.  It's a 4 bed 3 bath in a fairly nice area in Alabama (but I'm in Georgia!!).  

The pros are: 

Great, cute house with a lot of character.  No cookie cutter.   

Seller financed with NO MONEY down required of me!!!

Purchase price of $60k. ARV of anywhere from $135-$180k. In my inexperienced brain, that seems like a LOT OF ROOM for repairs.

The cons are:

It's out of state, 3 hours away (BUT, it's my hometown and I am VERY familiar with the area; and I also have family and huge network of friends/contractors located there.)

Needs a TON of work.  I am inexperienced in rehabs and really have a HUGE blindspot trying to estimate rehab costs.  A friend who's a contractor gave me a very soft, un-detailed estimate of $40k.  We just had an inspection done on the property and there's LOTS of water damage in every room of the house, foundation issues (cracks in every room), mold in 4 rooms.  I thought I'd upload a video of the issues to YouTube to see if I could find some help in estimating repair costs.  Please tell me it's less than $40k!!  Thanks in advance for any advice from you more experienced flippers.  

https://www.youtube.com/watch?v=oXvNmV_agVU

https://www.youtube.com/watch?v=IcHUfsI5bQU

https://www.youtube.com/watch?v=wgnLU8c71UM

https://www.youtube.com/watch?v=2x1PYmJWksI

https://www.youtube.com/watch?v=UNulJnkXn8Y

https://www.youtube.com/watch?v=ZcBssD0E71o

https://www.youtube.com/watch?v=e4ltcrItv1c

[Jeff Copeland]

That's way too much of a range in your ARV. I would try to narrow that down to a $20k range (at most) by looking more closely at comps.

Just based on what you've mentioned in your post, $40k sounds like a minimum...and that's assuming you do a lot of the work yourself.

There might be plenty of room in the budget for a $40-50k rehab. However, my biggest concern would be the foundation issues. I've seen foundation repair estimates that were $40k by themselves. I see lots of cracking in the walls, pulling apart of door frames, ceilings, etc...all indicative of settling/foundation issues.

The mold in the bathrooms is pretty common and doesn't scare me too much - but it appears every surface in the house is suffering from severe humidity - has it been sitting vacant without A/C, and was there a flood or plumbing leak that caused water damage?

There may be a reason the seller is willing to sign over the house to you with no money down... make sure all of your bases are covered and don't jump into a money pit without knowing exactly what's at the bottom of the pit.

Good luck!