Hey Bigger Pockets,
I'm contracting a deal tomorrow with a motivated seller. She owes 77k on the house and that what were contracting it for. The ARV is 203, but in a flood zone in NJ. Only the basement got wet from hurricane sandy. It needs to be raised 6 feet but it a relatively small house only 1200 sqft. The house isn't in terrible shape just really needs a **** ton of updating but a full gut would probably be the best. Im saying 35k and 45k for the house raising. So contract at 77, sell at 80. That 80 in repairs at about 40 for the rehabber. This is my first time contracting it a property but I just did a JV by finding someone a buyer for a different house. Any analysis would be GREAT.
A contract to her at $77K will not give her enough to pay off the loan after costs. Maybe $80K. Resell it to someone for $85K. $45K for raising it and another $30K for the gut rehab gets the rehabber to $170K vs. an ARV of $200K. 85% of ARV. Almost certainly a money loser for a rehabber. All in would need to be about $140K, maybe $150K. $75K for the rehab (and that's just a guess) means a rehabber would pay $65-75K. This would need a short sale.
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