Flip Deal Analysis Opinion - DFW, Texas
Hello BP,
Considering making an offer on this property for a flip. The area has great schools and a warm market, so I'm feeling conservative and confident regarding the ARV. I would be using a Hard Money Lender to do the deal - they loan 70% of ARV at 14% and 2 points, $275 appraisal fee. These are NOT wrapped into the loan. If I get my offer accepted, I have a 3 day option period to get my GC in there to make a more formal estimate of repairs. As of now I have toured the property, and explained the scope of the project to him over the phone, as well as sent him photos, etc.
This place is a total mess on the inside. It is a full gut job. The exterior brick is in good shape, but other than that, there will need to be repairs/rehab done to the roof, foundation, floors, walls, etc etc. Some of the Air Conditioning system might be able to be used, but I'm sure a lot of HVAC will need to be rehabbed as well. Because of how extensive this project is, I've allotted $30/sq ft, which comes out to just over $71,000 in renovation costs. My GC thinks he can get it to a great retail finish with 55-65k, but I'm trying to be conservative by saying 71k.
Related question for more experienced flippers: What do you usually end up spending on utility bills while the rehab is happening? I was going to say $300 a month for all utilities...but that was just a rough estimate.
The deal --> https://www.biggerpockets.com/calculators/shared/105390/8799483b-e188-484b-888a-0c92a9ee3556
Thank you ahead of time for your honest opinion and happy investing.
Dave