Well I found a really good deal on a Foreclosure. Everyone's having trouble getting financed because it was in the middle of a remodel so like some walls are ripped out, a bathroom is completely gutted. There's a tarp on a spot on the roof and minor water damage to the drywall inside. All drywall removed from living room; so you can't get FHA or USDA loans on it. I got approved for 50K to purchase, and up to 60k to rehab. It's a huge 5,000 square ft brick home on 10 Acres. I've been watching it for about 3 months. When if first foreclosed it was listed at 80k, and it's been under contract two times each time dropping a couple grand. I think the bank just wants to get rid of it. It needs a lot of work, but it's doable. The problem is there's no real comp houses to go by. In my mind with just the size it'd have to at least go for 200k, but I'm still a little nervous about it. What do you guys think?
With no real comps as you have said it can be difficult. What concerns me is the size of the house and the potential cost of rehab. Is all 5000 sqft considered finished space?
Ya, It's hard, but I think I'm going to walk away. If I'd been doing this longer, and could afford to lose a little money; I would definitely take a gamble on this one. It's one of the few ones that could actually make me around 100k orrrr I could lose 10 - 15k; I just can't afford to take that kind of chance right now.
As a business owner, I think it is a dangerous thing to think "If I can afford to lose a little money."
Don't let that mindset over establish a foothold in your business practice.
Losing money may occur and you need to overcome, but if you start with too much of a gambler's attitude, it will catch up with you.
It sounds like you are making the right decision on this one.
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