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I paid another visit to the house today with my father. He has a lot more experience working in houses. He thinks it will be closer to $30k to fix up. I know my comps are accurate, a house one street over sold for $129,500 on March 6, 2007. In late 2005 a house on the same street sold for $143,00. The house behind it is listed for $115K and is out dated, needs about 10k to modernize it. A VA repo is going up for $120K a street over and needs little to no work.

When I actually get contractor bids I will have a better idea of how much the rehab will cost. Mine and my realtors intial feel for rehab cost was 30k to. The person handling the sale is a realtor from Florida, he has not even seen the house, but he is trying to get the highest bid for the family (I believe he is related, money from the sale will take care of mom in a assisted living place). My agent is trying to get him to understand what condition it is in, she is also the listing agent. Picture 9 dogs living inside. Another investor offered $50K, they rehabbed the house next door and are currently renting it out. Seller turned it down and wants to list it for $90K, I told my agent when he comes out of La La land and returns to earth we can talk business. Until then my search continues. Thank you for your advice and help!

Alright after working with my agent that I have known for two years (sold me my house and then my parents theirs, we have kept in friendly contact) , she located a property for me. It has all the typical rehab signs. Vacant, people were recently evicted. It's the eye sore of the neighborhood. Bad yard, bad paint (peeling and cracking), inside is a mess, they had about 9 dogs inside, place stinks from urine and feces. Initial walk through I am think 30 to $40K in repairs. Asking price 76K (not on the market yet), I am going to make an offer of $55k with a bunch of outs which I already discussed with my realtor. Hard comps in the area 130 to 140K, house just sold 22 days ago behind the house for $129,500. From my intial inspection, house needs new subflooring, new flooring, kitchen/bath remodel, fixtures/lighting, paint in/out, landscape minor, mainly some sod, and new appliances. It is a 3 bed one bath house 1500 SQ ft, built in 1976. I plan on having three different contractors to give me bids. Heres making my first step, no more sitting on the fence.

Thank you for the input. I am working with a realtor as she wants to get her feet wet as well. We decided to partner up. This realtor was the one that sold me my house and my parents theirs. We have kept in touch over the past couple years. So we decided to team up on our first one. Again thank you for your knowledge.

Hello All,

I have been lurking for awhile trying to soak everything up. I am on my second real estate investment book and plan on searching for a property very soon. Not going to sit on the fence long.

To my question.

I am wondering if rehabbing is going to see it's down fall soon. When I first started thinking about investing, I was thinking about doing rehab's. Now I am not sure. I kinda have done a rehab, me and my ex-wife bought her parents house, for well below market. Put 6K in it for updates and when we divorced sold it for a 100k profit split 55/45. I now own another home, my new wife owns a rental. I am now thinking it might be better to do rentals, because of the changes in economy. I think pretty soon it is going to be harder for people to obtain loans and rates are going to go up. I have 10K of my own money and can get my parents to probably loan me 10K to 25K more. So are we seeing the end of rehabs or do we still have time.

I am tired of working for other people, I am 31 and wish to have finacial independence. My area is starting to grow. It is a small city but more and more larger companies are moving in. Costco, BestBuy etc... Areas 7 to 10 years ago thst were farms are now homes and shopping centers. So I think rehab might still be viable here or the next City over, thats 1 hour away. I was also thinking about doing a combo of the 2, rehab and rents. How ever mom ever viligeant took notice of an article in the paper saying flipping homes are not the way to go anymore. I personally did not see the article so I am not sure exactly what it said.

Thanks for reading this far. Any advice from you experienced rehabber's and not so experienced I look forward to reading your comments. So all of that in simple form, is: to rehab or not to rehab and rent instead.

Thank you,
Jason