House Under Contract......Need Help

[Derek T.]

I have my first potential rehab deal under contract and I need help with a number of different things.......

1. Help deciding if I want to rehab and rehab or flip and rent. I know I should already have my exit strategy in place

2. Help figuring out total scope of work and timeline. Here are the numbers.....

Flip
Purchase Price (B23)............................................$38,000.00
Repairs (B24).......................................................$22,165.00
ARV......................................................................$110,000.00
Initial Cash Out....................................................$6,072.65
HML Loan.............................................................$61,305.00 (plus $814/ month)
Debts at Closing When I sell................................$9,600

Flip Profit..............................................................$28,137.54

Hold
Total Loan Amount................................................$66,189.78
Total Monthly Mortgage Payment (Prin & Int)........$355.32
Monthly Insurance (.5%).......................................$45.83
Monthly Property Taxes (1.6%).............................$276.44
Other Monthly Expenses (HOA, WSG, UTL.)...........$0.00
Vacancy Protection/Maintenance (25% of Rent).....$350.00
Property Management Fee......................................$100.00

Monthly Cash Flow..................................................$272.41

Comps
Subject Property.............Comp 1.............Comp 2............Comp 3
Price.....$38,000.............$139,000...........$120,000.........$74,500
$/sqft........$37...............$129...................$108................$75
Sold.........N/A...............10/8/2012.............8/17/2012.........5/24/2012
Beds ...........2.....................3.......................3......................3
Baths..........1.....................1.......................1......................1
adj=$11k/ba.....................$0.....................$0...................$0
sqft..........1020..............1,080..................1,106................994
adj=$36/sf...-................-$2,180................-$3,125............$945
lot sqft.....6,534...............5,662..................6,098..............7,840
adj=$0k/ac....-...................$5......................$3.................-$8
Condition....poor..........above avg.............above avg.........poor
Yr Built........1951..............1954....................1951..............1954
Distance........-...................0.2......................0.2..................0.2
Adj Price......N/A..............$136,825............$116,877.........$75,437

Avg Price..................$111,167
Avg $/sqft................$104
Avg Adj Price............$109,713
Adj $/sqft.................$103.50

Adj Price Std Dev.......$31,315 *comp 3 wasn't rehabbed

I have found a bank that will refinance with no seasoning requirements once the rehab is complete so I can refinance quickly out of the HML. I guess it is a matter of instant gratification compared to delayed gratification. Both seem good to me however I can't really decide which to do and I am meeting with some GCs tomorrow so I need to have my action plan down along with a scope of work that will be correlated to my exit strategy.

The one thing with reselling it is that I am converted a 2/1 to a 3/1 but it will probably sit longer than other houses. I am trying to see if I can add another bathroom (either half or full on to the master) but I think it will not be feasible with my budget and the market for the house. For a rental it is a smaller 3/1 house (1020 sq ft) in a so-so working class neighborhood.

I will attach pics for the scope of work......