@James S. thanks for the questions! My business partner and I are splitting 60/40. He came with the majority of the knowledge and money so I am getting the smaller percentage. We worked with a local wholesaler, and BP member, to find the house and close the deal. The numbers are as follows:
Purchase Price: 40,000 (The flip house and the next door property )
Rehab Budget: 70,000
ARV: 159,900 (List Price)
Estimated rehab: 4-6 Weeks
Estimated net profit: 40,000
So when we started the process, we had numerous contractors come through and put in bids. Savannah is kind of a big city but also small in a sense. The majority of the contractors that walked through were estimating a 10 week rehab which was longer than we wanted. We found a company out here that does everything internally. They were a little more expensive but with a 4-5 week rehab we went with them. We negotiated the price a little and settled on 70k (we were hoping for 60).
As for comps, we had our Realtor run a CMA for the property. We also did research on our own. Again, Savannah being slightly odd, comps are hard to run. There can be a 1.5 Million dollar home on one street and on the next street over you are looking at a 60k neighborhood. That being said, comps ranged from about 135 to 225k. With the size of the house, and the street that it is on (quiet and friendly), we decided 159,900 would be a listing price that would be a great deal, help it sell quickly and still leave enough room for a good profit. The majority of the houses across the street are in the 200k range. Our side of the street is a little smaller in the size of the homes.
As for the property next door, we are cleaning it out from the previous owners items left behind and then listing it as a wholesale property for another investor to pick up as all of our funds are tied up in the house. We are listing it at 20k. It needs about 75-80 in work but the ARV is around the same price of 159,900. If anyone is interested in that please PM me.
We have hit a couple of snags in the budget. We were quoted for one pump-out of the basement and one of the windows wasn't sealed yet so some water got down there and we are needing to pump it out again. Nothing crazy but a little extra cost. I think we also may need to raise the height of a door way which was not quoted either so we will see. Small things that chip away at the budget that always come up.
All in all, a pretty big rehab for my first project. Love putting my feet to the fire. This house will sell quickly once we list it. It will make a great family home or a great investment property for a buy and hold. Any other questions please ask I love talking about this place!
