2 Bed/1 Bath...Are my numbers right? Best method of acquisition?

[Jason Eyerly]

Hello BP,

    I'm looking at this deal for a family member. I've heard some folks say they would have jumped on it, but now that I'm running it through the deal analysis here on BP I'm a bit confused. The full report is HERE if you care to look and help me out. Here's what I have though:

• ARV: $84,000
• Purchase: $48,000
• Construction: $10,000
•     Total: $58,000

Acquisition W/ Conventional Mortgage:

• 20% Down: $9,500
• Construction: $10,000
•     Total: $19,500
  

I've basically narrowed it down that for my family member to obtain the property they would either need to use a HEL/HELOC for the full amount (I believe they are a bit short on equity in that) or take out a HEL/HELOC to pay 20% down payment and construction costs, and finance the rest traditionally. However, this report shows monthly income as $328.77 which is only 0.55% of the purchase price monthly, and that's not including a loan on top.

All that being said, is this even a buy and hold property, or would this serve better as a fix and flip for myself going with a HML? I'm assuming my Wholesaler is correct in his construction (hopefully a bit less) and rent/sale comps. I'm waiting for more accurate data from an agent/contractor. As a fix/flip after $48,000 + $10,000 not counting interest and closing costs it barely makes the 70%. Assuming I'm correct in my HML assumptions, then after the points and fees, this would be at about 73% of ARV.

    I'm looking at this as a first fix/flip but because of the age of the house, and the location I'm a bit worried that the resale is where I will get stuck with the property. I have to impress my business partner and make us some money here, so I REALLY don't want to flop.

     Thanks for hearing me out. I appreciate any advise or input anyone has for me. 

Best Regards,

    Jason T. Eyerly