First Real Estate Deal
I have the opportunity to buy a single family residence for cash. The seller bought it for rehab and after gutting and finishing the framing changes/repairs(current state of the house), ran out of cash and needs to sell asap. Waiting on inspection report that I should get back very soon. I am excited because it is down to the studs and I anticipate no surprises because everything is visible. My dad as well as my father in law are both contractors who can guide me through repairs as needed although I have many summers of experience through high school and college.
House: 3 Bedroom 3 Bath 1596 sq. ft. Local Rents: $750-$1100
List Price: $23k
Estimated Renovations: $30-50k Have commercial line of credit lined up for repairs @ 6% interest only for 6 mo.
Local Comps: $95,000-$110,000
Bank stated I could do a refinance for 70% of ARV with no seasoning period if I were to keep the property.
I will be doing a majority of the rehab myself and hiring out trades such as HVAC, plumbing and electric.
Should I pay myself for my labor or rather keep the 'sweat equity'? Does it depend on which exit strategy I use?
Would one recommend use this as a Fix and Flip or use BRRRR strategy as this is my first property purchase(other than my primary residence).
My wife and I are very new to R.E. investing and do not have a lot of people in our lives that are knowledgable about analyzing deals like this. ANY HELP ON THIS WOULD BE APPRECIATED!!