Let me start by saying I’m from the metro NYC area which is about 5 hours away from Syracuse. I have a probate deal in Syracuse, Ny currently under contract at a $25k purchase price, $10k for the owner and another $15k for back taxes and utility bills. The houses ARV is about $70k but it needs a complete gut renovation, new plumbing and electric but even with all of that there will still be equity in it. Not to mention it can be rented out at about $800-900 a month to tenants, it’s only 10 minutes from Syracuse university! I’ve spoken to a couple of investors in the area but the project has been too large for most. I’m open to financing it myself and doing the flip but it would be hard to manage the project from 5 hours away and I don’t know anyone in the area. Any suggestions, advice or options I may be over looking?

Howdy @Derek Moore

If this is a Flip the numbers are not good.  Depending on the cost of Rehab it may even be a negative.

$70K x 70% = $49,000 - $25,000 Purchase price = $24,000 Remaining for Rehab, Holding and Closing (2 closings) Costs.  That gives you $21,000 profit if you can meet these numbers.  What is your estimate for the “gut job”?  The closing costs will probably be at least $6,000 for both (if you have to pay for both).  What is your estimated timeframe to complete the Rehab and sell the property?  That impacts the Holding costs.  How much (little) profit are you willing to take?  What is the selling market like in that area?

@Derek Moore , 10 minutes which direction? Most of the area around the university is a neighborhood by neighborhood situation so you should know what you are getting in to. If you are out by Westcott or even Salt Springs area that could be worth it (actual numbers notwithstanding to a degree) but there are a ton of houses for sale under $10k just to the east of 81 and on the north side that are not going to be worth the effort. 

Also take in to consideration the feedback have you gotten from other investors. If they are experienced and local but it is too big for them then maybe a sign. Find a $50k house that needs $10k of work and bite off something a little smaller perhaps.

I would agree with @John Leavelle on the low profit margin, too. If you need a roof (which is almost always the case), you are looking at $6k right there. Good luck and hit me up if you have any questions. Happy to help out.

Originally posted by @John Leavelle :

Howdy @Derek Moore

If this is a Flip the numbers are not good.  Depending on the cost of Rehab it may even be a negative.

$70K x 70% = $49,000 - $25,000 Purchase price = $24,000 Remaining for Rehab, Holding and Closing (2 closings) Costs.  That gives you $21,000 profit if you can meet these numbers.  What is your estimate for the “gut job”?  The closing costs will probably be at least $6,000 for both (if you have to pay for both).  What is your estimated timeframe to complete the Rehab and sell the property?  That impacts the Holding costs.  How much (little) profit are you willing to take?  What is the selling market like in that area?

I was looking at it more as a buy and hold because thats where the numbers make the most sense. The $24,000 rehab estimate cost you came up with is only a few grand off of what I had. The rehab could take 8 weeks max and cash-flow can begin whenever a suitable tenant is found. 

Originally posted by @Will Chamberlin :

@Derek Moore, 10 minutes which direction? Most of the area around the university is a neighborhood by neighborhood situation so you should know what you are getting in to. If you are out by Westcott or even Salt Springs area that could be worth it (actual numbers notwithstanding to a degree) but there are a ton of houses for sale under $10k just to the east of 81 and on the north side that are not going to be worth the effort. 

Also take in to consideration the feedback have you gotten from other investors. If they are experienced and local but it is too big for them then maybe a sign. Find a $50k house that needs $10k of work and bite off something a little smaller perhaps.

I would agree with @John Leavelle on the low profit margin, too. If you need a roof (which is almost always the case), you are looking at $6k right there. Good luck and hit me up if you have any questions. Happy to help out.

 The house is located to the north west of the university.  Thats a great point I just wanted to get a second opinion. The cash flow as a rental could be great even after the large rehab but now I'm questioning the quality of the tenant pool that would be interested in the area. The roof on the house is good, the foundation is good, it needs interior work only.

@Derek Moore

Ok.  So what does your Cash Flow analysis look like?  Is it currently rented? Is the projected $800 - $900 Rent per or total?  If per unit the Cash Flow should be pretty good.  Of course the real concern is apparently tenant quality it seems.

@Derek Moore - direct message me.  we are very active buyers and owners in the Syracuse market. 

Originally posted by @John Leavelle :

@Derek Moore

Ok.  So what does your Cash Flow analysis look like?  Is it currently rented? Is the projected $800 - $900 Rent per or total?  If per unit the Cash Flow should be pretty good.  Of course the real concern is apparently tenant quality it seems.

 The property will be delivered vacant at the closing. The rents are $900/ month each which means the cash flow is good and after speaking to others in the area the tenant quality is no longer a concern. My main concern now is the amount of rehab needed to make it rent ready. 

I second that you make sure the neighborhood is a desireable one. From those numbers I'm guessing not but its been awhile since I lived there. And let me tell you I never plan to make it back, it was not an enjoyable place for me. Granted, I did live in the pink pepto-bismol mansion on W Onodoga which was cool but it was not a great neighborhood at the time.