Potential DEAL! Please help

5 Replies

Hey everyone! I have been reading tons of helpful information on this forum and reading books on real estate. I want to get started and take action. There is one SFH in the neighborhood that I stopped by and looked at. It seems like a great fixer upper for an investor. I would like know how would I approach this and possibly wholesale it.

http://www.zillow.com/homedetails/107-Spook-Hill-Rd-Wappingers-Falls-NY-12590/30145664_zpid/

Do I contact the real estate agents to get it under contract? Now the houses in that neighborhood go for around 200k-225. How would you guys analyze this deal? Say minimum ARV is 200k and max repair cost is 35k.

It looks a little too slim for me. It's priced at $150,000 which is 75% of your ARV. I wouldn't trust anything over 70% really. After you add in your repair costs you're looking at a potential profit of $15,000. Have you factored in holding costs and such? That $15K can get eaten up really quick I would think.

Thanks for your response! Great, now I see how these numbers come into play. What holding costs would I need to calculate, If I plan on assigning the contract fast? I have no experience with real estate so far, hence the newbie questions sorry.

Any others have a say? Thanks appreciate it!

Originally posted by @Preet Singh :
Say minimum ARV is 200k and max repair cost is 35k.

Well if you use those numbers, if you pay $150k for it and rehabbed it you'd lose money after closing costs. That's assuming you paid cash and had no holding costs or borrowing costs. You'd have to get this under contract closer to $105-110k to have a wholesale deal.

Of course none of that really matters. It's a bank owned property on MLS, every investor in that area has already seen the listing. If it's a deal they'll buy it, it's not a "wholesale" deal. Go find something everyone else hasn't already seen and then you can make some money on it.

Ok thank you for the feedback! Appreciate it

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