*This link comes directly from our calculators, based on information input by the member who posted.
Ok just having some fun with a recent property for sale about two blocks from where i live
Inviting all experienced investors to take a look at this deal, and give me they’re opinion if its even worth it.
A little bit about myself. I’m 25 live at home and currently looking to jump into my first deal.
Been looking for out of state deals.
But recently there’s this house that I’ve been keeping my eyes on. its had a for sale sign. now for a few good while now ( over 6 months for sure ) And recently another real estate company took over and put an open house sign. So i walked in to take a look.
Overall its pretty nice most of the interior has been remodeled. New kitchen, new floors,roof, paint, etc. The only thing is that the interior of the garage is incomplete, needs dry wall and a ceiling. I’m not a contractor so idk how much it would cost to put it back to shape, i just threw a high number into the calculator just for a prospective idea. It’s a 3 bedroom 2 bathroom house. The area is actually a growing market I’ve lived here over 20 years and its come along way from when we first moved. And it seems its been taking off the past few years 5 years They just recently build a massive shopping plaza less than a mile away. Renovated the park thats about 3 blocks away, and a new shopping plaza is under construction about 4 blocks away is near 3 major freeways and the houses around are all typically rising to the 500,000 plus price range. And about 15 min from downtown.
The house is actually listed for 499,000 but its too overpriced for the house in my opinion, I feel that’s the reason why they’re having a hard time selling, and not because no ones looking. The sign in book was actually already pretty full, so to me that tells me many people are interested in the property, maybe if they don’t end up buying the house they might consider renting it. It’s what makes me feel the problem is the price OR that simply the area is turning into an upper middle class area too fast for the people to keep up. Our house (which is 2 blocks away) was worth around 380,000 in 2015. Now its around the 498,000-500,000 range ( its a 3 bedroom 2 bathroom house as well.). I’m only going based on the home value estimator on realtor. But it seems pretty accurate considering the recent renovations the city’s has done and with the new ones on the way i feel the houses in the area are only going to continue to rise. BUT this also makes me consider this “bubble” everyone keeps mentioning, i guess no one can really say for sure when that day will come when it finally start going down. But i hear a lot of expectancy of it dropping in 2 years and then i hear a lot thats its only going to get higher for the next 5 years. So there’s that too. I mean if it’s already hard to get someone to but it now. Maybe it’ll be even harder then.?
So in nutshell this is a pretty hefty turnkey investment considering I’m just about to get started. In order to get into this property i will most likely have to co sign with a family member since my credit is around 698 and i only make around 42,000 after taxes. And it doesn’t offer much in cash flow and actually I’m almost positive I’d be paying out of pocket every month. High balling it maybe around 300 a month. So why am i considering it? The equity, the convenience that its super close to me, the experience, and my confidence that this area seems to have a good outlook in its potential growth and if I’m being honest a 300 dollar payment for a potentially 500,000 house doesn’t seem bad at all. Considering I’m living at home for free. So that’s where my heads at more or less. Just curious to see how some of you would handle this property if you had the opportunity and in my situation. Considering this is in LA county. Where almost anything decent is in the 600-700,000 ^ price range.
-high purchase price
-garage needs repairs
-most likley no positive cash flow 1st year
- House newly remodeled interior ( new kitchen, bathrooms, floors, roof, windows )
-two blocks away from me ( convinient distance )
-potential equity seems promising.
- no rent control
ok so NO I DO NOT think you should consider buying this home.... first of all i think your numbers are off, insurance on $500K home is way more than $50 a month...also you will need 20% ($90,000) for down payment if purchase price is 450,000......then you also need to consider other expenses like vacancy, repairs, property management (even if you self manage)..... as your first deal this is way too much risk for negative cash flow and the hopes of appreciation........if its still sitting on the market, then its over priced....... an appreciation play is not a smart first investment IMO