All Forum Posts by: Nate Miersma

@Michaela G.

- Excellent point. I'll DEFINITELY be keeping that under close consideration before making my final decision!

Thanks everyone for the insight here! The seller is a borderline hoarder...so despite his assurances that he wants to move everything out, I'm fairly confident that dumpster #1 would be full of...."household items" would be the best way to describe them.

@Will Barnard - I completely agree with your statement. I wasn't looking for rehab/renovation budget rules of thumb. I probably wasn't specific enough with my question. What I meant to say was: "how much to have someone come in and tear everything OUT before I bring people in to do the rest of the rehab?"

The answer may still be the same - depends on so many factors...but between the time I posted this and the time I'm writing this, a sub told me he had a couple employees who'd be happy to do the "gutting" for a very competitive hourly rate. Turns out getting to do the tear-out portion and get paid for it is a treat for some.

@Marshall Downs

Another Midwest welcome! Great to have another Michigan investor on board.

Marshall, have you done any wholesaling in Michigan? There are a couple of threads about Michigan laws (closing requirements / restrictions, etc) and I'm curious if you've been successful with any "traditional" wholesaling methods.

@Jassem A.

Sometimes an obvious question like the one you asked is just what the doctor ordered. Valid point!

Although, from what I understand, someone has been smoking the hookah in this place for so long that it might take a few extra layers of primer to get rid of the smell.

@Raymond B.

Huge! This excel file is an excellent tool for a walk-through renovation estimate.

@Michaela G.

The contractor is a good friend of mine and is essentially managing the projects as the GC, not doing any of the work himself or charging for his time (we share the profit at the end of the deal). So that's squared away - we're not getting "retail quotes" and he knows the industry well enough to know the difference.

I'm going to guess at this point that he floors AND subfloors need to go based on condition. HVAC is good; newer furnace, newer hot water heater.

Structural work is highly likely - it appears that this home was converted from a duplex long ago and there's no flow to the floor plan. They're using a breezeway as a master bedroom right now as an example.

Structurally (critical structures- foundation, load bearing members, etc) the building should be sound or I won't purchase the property regardless of the rest of the description I posted.

Thanks for your input! I sincerely appreciate you taking the time to post your thoughts.

Property: 5br/3ba, 1 acre lot w/ 30x40 Pole Barn

ARV: $215,000 - $220,000

Purchase Price: $70,000

Renovation Required: Estimated $80,000-$100,000... 100% complete renovation required - home in disrepair, utilities shut off (but operational per seller), owner living there with kerosene heater and gas generator currently; drywall repair/replacement throughout; new flooring; some new windows; complete kitchen demo/renovation, everything else you'd expect in a flip.

Potential issues: Home exterior is 100% brick; my partner thought he saw some issues (bricks cracked/missing) in a couple spots on his way in; house smells (like money to me - like a combination of dog urine and marijuana to most others!); INSIDE walls have either real or faux-stone on the walls - if it's real it may be labor-intensive to remove; it's winter in Michigan so exterior work has to be done around the weather

Question: We typically don't sink this much into renovations in Midwest properties, but the ROI still looks good. And I'm working with a new partner/general contractor who is VERY talented, but who hasn't done a ton of flips, so the scope of work is a bit overwhelming to him as he looks at the house in its current state of disrepair. Is it worth investing this much in a renovation with these numbers, or would you pass this one by and go after two more cosmetic flips instead?

Welcome! Always good to see more participation from the Midwest.

Does anyone have a rule of thumb that they use for a complete, nothing-left GUT of a home in disrepair? The one I'm evaluating is about 3,000 square feet and needs to go down to the studs in most places. Electric and plumbing are fine, but the drywall and even some of the ceiling needs to go in most places. This is separate from the "building and construction" costs associated with renovating after it is gutted completely. Thoughts are appreciated! Any