I'm very new to Real Estate and am looking to start out by doing some SFH Fix & Flip to eventually roll into Big Multi-Family Rentals. I live in Roselle at the moment which is in Union County NJ. I'm beginning to drive for dollars to make a list of potential houses that I can be looking at to flip.
I'm looking to put together a mock deal to then present to a few people that I'm close to who have told me that they are interested in REI and could potentially help me out with Financing. What can I put in such a presentation, how do I narrow my criteria and how do I find out what's working and what isn't?
How do I go about budgeting for Contracting as in what's realistic and how do i build a good safety net within that budget without being too generous and without being too conservative?
I'd appreciate anyone with some flipping experience who could help me out with some of these factors?
PS from my analytics, it seems if I want to budget correctly, I should not be buying over 45% of the ARV if it is a house that needs major repairs. (Considering holding costs and my assumptions on what it potentially costs to flip a home correctly)
Is that typical?
As a flipper, you typically you want to make sure you get a property for 70% ARV minus the costs of the rehab. So 45% is a super deal. However, our town Roselle has higher than average holding costs (due to the extremely high property tax) which makes your ARV percentage something to strive for. Seriously, I evaluated two multifamily in Roselle that had 15K and 20K property tax bill. Insane!
@Marcus Lawson Totally agree, most single family houses that I'm looking at in the area have an average tax bill of $8k-10k. Have you done any flips in the area before or any of the neighboring counties?