Can you go wrong with a $22,000 deal?

Question

Hey all! So I can pay cash for a 1bedroom 630sqft house built in 1955. It obviously needs a lot of work, but 630sqft is a VERY small area to renovate. Also has an attached awning/carport. It is in a "meh" to sub-par neighborhood, but really close to a University. Having trouble nailing down an accurate ARV...houses in the area are literally all over the place. From my research it looks like we could sell it for $75,000 fully renovated. However, I plan to rent it out rather than flip it. Being so close to campus, I figured I should have no problem renting it for $500/month (more if possible).

All that being said, I am new to RE investing so I wanted to see what all you professionals thought. I feel like it would be very hard for a $22,000 purchase (not including renovation) to go south. Or maybe that is just my ignorance?

Thank you for your time,

-Colton

All that being said, I am new to RE investing so I wanted to see what all you professionals thought. I feel like it would be very hard for a $22,000 purchase (not including renovation) to go south. Or maybe that is just my ignorance?

Thank you for your time,

-Colton

Moises R Cosme · Answer

Colton,

1. Check the foundation

2. Is it on a septic system?

If items 1 & 2 are good... BUY IT!!!  I had a similar deal last year and it worked out really well.

Colton Pearson · Answer

Thanks for the reply! It is actually on the cities sewer system which is a huge bonus. I will check into foundation...

Thanks!