Would you take this gut rehab deal or walk?
A place just came on the market 2 days ago. It is owned by FannieMae and has been vacant for a year. The previous owner started a rehab job. It looks like they got as far as completely gutting it. There are interior wall studs. The outside siding is slightly cracked, splitting and rotten in some place. The brick work is good. No foundation issues. Roof may be suspect. So on to the numbers.
This house is in a highly desirable neighborhood north of Dallas. The bank is asking $110K. My realtor comps ARV at $305K. I have plenty of capital but will probably use my hard money lender who I have worked with in the past. I am sure he will back me on this project. But I don't have time. I need to get an offer in and then talk to my experts.
So here's the problem; I have only done a half dozen rehabs over the past decade. Probably a dozen if you count cosmetic only rehabs. I have even done two mold rehabs. I plan to use a GC to do the whole job on this one instead of piecemeal. But the gutted house is scaring me. Should I take that as a good sign? Do I need to step out of my comfort zone? I am figuring about $100K to rehab the place and bring it up to the executive home standard of the neighborhood (granite, hardwoods, non-builder grade stuff).
So given my experience and the numbers on this deal would you take it or walk away?