All Forum Posts by: Adam Scheetz

@Dennis M. I know it sucks. Banking on appreciation worked great for investors and home owners in 2007-2008!! I never plan on appreciation. If it happens then great but cash flow is my goal. I'm going to keeping crunching away at this property and seeing which route makes since. Buy and hold will depend entirely on the rental income. Otherwise, a flip it will be.

@Dennis M. Believe it or not, the taxes on this one are some of the lowest. Typically there in the 7-8k range. Waiting on a itemized SOW to nail down the costs more than an approximation. But typically for this area, I'm finding that for Drywall, floors, paint, K&B, most folks are around $50k ish. That's also for a rental. Flips sometimes have a little nicer detail so I'd have to find that happy place between return on purchase and making it look really good.

 @David K. I think that's what I'm looking at. If I'm lucky to get some higher numbers mainly rent. I'll look at a short hold possibly 2-5 yes as long as it cash flows well ie. $300/mth net. If not, just flip it since the equity is there. This market right now is renter saturated. My agent has more renters than houses. Which strikes me as a good place to be.

@Tchaka Owen that's what I was thinking. I liking having multiple exit options. Shoot for a B&H, especially if I can get the numbers to go down through good fortune and skillful planning. Even a low ARV would still leave enough equity to make a flip a solid option. Might consider partnering if I flip for the added benefit of smaller exposure and increased networking. Options are always good. Thanks Tchaka for the feedback.

View report

*This link comes directly from our calculators, based on information input by the member who posted.

Quick Synopsis in addition to the linked report.

1. SFH. 3/2. 1388 sq.ft. Great community. Good clean neighborhood. REO.
2. Asking $89,000
3. Rent $1600-1700
4. ARV: $195,000- $210,000 Conservative Estimate.
5. Estimated Rehab: $50,000
6. Taxes: $5150
7. Insurance: Conservatively-$125/mth
8. Built in 1995 so E&P are solid. 
9. Needs rehab, not a full gut, but moderate rehab to Drywall, floors, kitchen and possibly bathrooms also.
10. Nice neighborhood plot, middle income area, well kept homes

I'm looking at a renovation loan through an experienced and trusted lender who is very familiar with 203k/FNMA Home Style Renovation/Etc loans.

This area is expected to appreciate someone in the ball park of 4-7% this year with the influx of some new job growth drivers and attractions that are bringing people in. 

Please let me know what you think.

@Ashish Acharya that's great news.

@Wayne Brooks Well that sucks. I'm married filing jointly and thankfully come in at the 12% rate by staying under $77,400 taxable amount. But 12% + 15.4% makes for a painful tax pill to swallow. What are the work arounds to avoid that additional 15.4%??

I'm partnering on my first flip with an experienced investor. I'm providing capital in exchange for percentage of sale profit. Following the sale, I should net somewhere around $20,000. I need to know, if he reports the profit for me via 1099-INT, what % should I responsibly set aside for taxes. I'm a military member living in NYC, my residency is in FL.

Again, I am ONLY providing money for flip. No mortgage, no swinging hammers, no employment. Straight Financial partnership in exchange for net proceeds.

Thank You in advance for being awesome.

***UPDATE***

It needs a complete and total rehab, down to the studs. As mentioned by other on the forums, a safe estimate of $100k or more is not out of the question for the rehab. The layout is actually pretty cool, but the scope of work is more than I'm able to handle at the moment.

Additionally, I stopped and spoke to a local Deputy to get his take on the area. He confirmed that it's not terrible. No gang activity. The majority of what he see's are drug related offenses in that area. Not that particular street, but in the area.

There is also some exterior work needed to boost the curb appeal. One thing I wasn't too fond of was the room sizes, they are a bit smaller than I like, but is also typical in these year homes in Jersey.

Though the equity is diminished by doubling the rehab cost, it's still there and the cash flow will still be possible, especially with a nice rehab. Just not something I can take a full bite of right now by myself.

***UPDATE***

It needs a complete and total rehab, down to the studs. As mentioned by other on the forums, a safe estimate of $100k or more is not out of the question for the rehab. The layout is actually pretty cool, but the scope of work is more than I'm able to handle at the moment. 

Additionally, I stopped and spoke to a local Deputy to get his take on the area. He confirmed that it's not terrible. No gang activity. The majority of what he see's are drug related offenses in that area. Not that particular street, but in the area. 

There is also some exterior work needed to boost the curb appeal. One thing I wasn't too fond of was the room sizes, they are a bit smaller than I like, but is also typical in these year homes in Jersey.

Though the equity is diminished by doubling the rehab cost, it's still there and the cash flow will still be possible, especially with a nice rehab. Just not something I can take a full bite of right now by myself.