Need help analazing my first deal.

4 Replies

Hello everybody,

So i came across this deal through my brothers girlfriends parents. They had a property that the bought in 2010 and have since moved out. They didn't sell the property first so now its sitting vacant. Here are the details. Please bear with me.

3 bedroom, 2 bath, full basement with another 3\4 bath in it. One story. Im not sure on the square feet. Here is a link to the area the house is in. 

http://www.zillow.com/homes/bunker-hill-dr-bellevi...

I didn't get the purchase price, i overlooked that since this was my first ever attempt to talk to a potential seller but i can get the info at another time.

They owe $108,000

Monthly payments are $950

Taxes are 2000 anualy

All payments and taxes current

They wanted to list it for $120,000 but never got around to it, so it is not currently listed but they will take $110,000.

They are also willing to do a 3 year sale on contract with an option to buy at the end of the 3 years. 

They have no time line, they just want to get rid of it said the lady. 

They re did the roof 6 years ago, as well as the backyard fence around the same time, only major possible repair is that the AC and heat are old but still functional.

So all in all my gut sais they want to much for the house. I think they bought it for to much initially. Zillow says its worth $85,000 about. But im not sure if that's accurate. However she said they are willing to be creative on the financing. So, my question is what would you guys do given this info. would you be willing to maybe go for the 3 year option with them or maybe try and whole sell it. Maybe even work out a deal where i take ownership of the loan and then rent the property out. Is it even worth me trying anything. Is the asking price to high?

Any advice is greatly greatly appreciated and thank you all in advance.

How much is the house worth after rehab?  And how much rehab is needed to get it to that value.

Those are the two pieces of information you need.

Don't rely on Zillow for values -- find a local expert who can help.  If the value after renovation is really $85K, there's nothing you can do here as a fix-and-flip.

After rehab i would say the house could be worth $110,00 and it dosnt need much rehab. It has new carpet, new appliances, however it does need a bit of drywall, maybe 1500 bucks worth of drywall. So id say maybe 5000 total for rehab.  Some new information that came my way was that they purchased the home for $93,000 and extracted some equity so that's why they owe $108,000. Houses being sold there seem to be around the $85,000 to $110,000 area.

Originally posted by @Gustavo Orozco :

After rehab i would say the house could be worth $110,00 and it dosnt need much rehab. It has new carpet, new appliances, however it does need a bit of drywall, maybe 1500 bucks worth of drywall. So id say maybe 5000 total for rehab.  Some new information that came my way was that they purchased the home for $93,000 and extracted some equity so that's why they owe $108,000. Houses being sold there seem to be around the $85,000 to $110,000 area.

If the house can only be resold for $110K, it should be obvious why you wouldn't be able to pay $110K to buy it (assuming your plan was to flip it).

Unless you could get the house for substantially less (probably closer to $80K), it doesn't seem like a very profitable deal from a flip perspective. 

Well this is my very first deal that Ive looked at. Im going to offer the lady about $80,000 and see if i can get it under contract so i can whole sell it. Im pretty sure its going to be a no go but regardless i have to give it a shot. Considering they have a second home that's worth about $500,000 perhaps they would be willing to take a loss on it just to get rid of it. We shall see. Thanks for your help

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