Total Rehab or Not??

[Kevin Pinkard]

Hello all,

I have been brought a trailer in New Orleans that sits on a double lot that I can get for 65K but the home needs a total remodel.  I have a contractor that says he can get everything done for 70K in 3 weeks but after having the inspector came in there is a lot more work that needs to be done.  Plumbing, electrical, sagging roof, mold, flooring, ceiling, and foundation leveling are just a few things so Just about a whole new build and there are still questions about the framing because of window units that have not been taken care of and water has been running down the walls.  My partner wants to leave it and move on to the next but I think a full remodel might not be as bad as it seams since the comps run between $265K-$284k and if we can do all of the remodeling for say $150K including buying the land we still could refinance for the $265K at a minimum and do another buy. Should I listen to my partner who has been doing this for over 20 years or take a chance?

[Mike Hasson]

Wouldn't It cost less just to buy a new mobile home?

The thing about mobiles is they depreciate, while site built homes appreciate. Are you basing the ARV for refi by comparing to similarly sized built homes? If so, that would be a mistake. Banks do not value mobiles the same as site built homes and neither should you.

Details aside, based on your final question "Should I listen to my partner who has been doing this for over 20 years or take a chance" that you already know the answer.