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This is a deal we are closing on next week in Pittsburgh PA. It's 3 duplexes, 2 are really rough and one is currently livable. With our in house construction team we will do the rehabs probably cheaper than budget but we are being conservative on numbers. Let me know your thought please.
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
8y
If your numbers are right that is a pretty high return but 6 units for $226 seems like they could be in a bad area. Also it seems unlikely to me that 140k in repairs would generate over 300k in value in regards to ARV
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
8y
If your numbers are right that is a pretty high return but 6 units for $226 seems like they could be in a bad area. Also it seems unlikely to me that 140k in repairs would generate over 300k in value in regards to ARV
Contractor · Pittsburgh, PA · Member since 2016 · 95 posts · 18 votes
8y
@Aaron Klatt
It’s in Mt Washington which I would consider a C neighborhood. I have licensed plumber/electrician on payroll and will be doing all repairs in house and absorbing a little bit of labor on my shoulders. Although I have 3 crews on payroll. We do cosmetic rehabs all day long under $25/sq ft. One is cosmetic two need plumbing and electrical but once again my plumber can repipe a duplex in 1 week @ $20/hr. Similar numbers on electric. Furnaces will be a big hit but other than Hvac it’s all in house. I will keep everyone posted with budget and progress. Feel free to check us out @ pittsburghpropertyrodelers.com
and pghpropertybuyer.com
Specialist · Riverside, CA · Member since 2015 · 6k+ posts · 3k+ votes
8y
Perhaps because you are a contractor you can make these numbers work but for an average person paying a contractor spending 1 dollar to create 2 in value in the numbers you're talking about is very difficult to do in most markets.
Are you planning to Refinance all three properties together? If so I think you need to re-evaluate the type of loan you will be able to get. 6 units would be a commercial loan. The terms will be significantly different.