Updated almost 4 years ago on . Most recent reply
Analyzing a deal for a newbie
I'm brand new to RE and would like to see how a more experienced investor would go about analyzing a deal. The house is selling for $18,637 and Redfin values it at around $46,000. There is a video link of the house: https://www.youtube.com/watch?v=ihEjb1Hm9I4&featur...
The house isn't in the best part of town. What would you do in terms of renovation, what do you expect the costs and ARV to be, what would be your strategy in terms of funding and closing options? Would this be a good deal overall? Anything else that seems pertinent?
Thank you!
Most Popular Reply
Can't do your homework for you as I don't live in the area, nor do I know what your end-game for this property would be. Flip? Wholesale? Rental? By the looks of it, you'd probably spend more on the rehab than what the house is actually worth. It'd be thousands in demo and dump fees alone. This property is literally on the wrong side of the tracks lol. The train tracks 20 feet away are a killer. As a newbie, you may want to pass on this deal. If you're into flips, you should read Flip: How to Find, Fix, and Sell Houses for Profit by Clay Davis and Rick Villani and The Book on Flipping Houses by J Scott. To me, these are basically the bibles of house flipping. If you're into rentals read Brandon Turner's The Book on Rental Property Investing. Can't go wrong there.
One more piece of advice. This is something I've read and something I've done so I know it works: Analyze at least 10 properties per day for a month. Run the numbers, check the comps, learn the neighborhoods. You'll be surprised how quickly you'll be analyzing houses at the end of 30 days just by knowing which streets the houses are on and what parts of town their in when looking at a map.