I saw a house yesterday that is gutted and cleaned out. New electric, roof, porch, plumbing, drywall. The work is solid but unfinished. Needs full bathroom (shower, toilet, sink, etc) and kitchen. After renovation value in the area is about $150k for old but livable, to $220k+ for nicely updated homes. There is a lot of construction happening in the area. Luxury apartments and single homes. Walking distance to the Philly train and Main St. w/ good breweries, restaurants and shops. They have an offer for $90k cash and wanted to know if I can top it. At $95k cash with a $45k renovation budget, do you think it’s still worth it?? The area is a Blue Ribbon school district BTW. Thank you!
Hey @Elaine Lai - if that work is permitted and you have 45k locked in (I suggest making sure your contractor blesses the work done to it) you should lock that thing down at 95k. After ROUGH expenses (I'm making a lot of assumptions about closing costs, transfer tax, realtor commission, etc) you are looking above a 50k profit, 45k conservative, 60k optimistic (all depends how you slice your realtor fees and concessions). I'll follow up with you in private messages
@Elaine Lai - just make sure to due your due diligence. make sure to stay on track with the budget and if you feel comfortable closing. Go for it
Thank you, both! I've walked the property for over an hour w/ my contractor and now have a better idea of the rehab costs. I'm getting an official itemized estimate for the project from him. How do you go about offering an extremely low-ball offer based on the estimate from a contractor?
it look like you have a good deal! @Elaine Lai