1st Rehab Deal - Once-overs Wanted
OK, here's the scoop, and it's from a wholesaler so I don't have any time invested yet:
Selling price: $27.5K
Low ARV (using tax info): $69K
Repairs: $12K (will verify with GC)
House is near rapidly rejuvenating historic district (Riverside, for those familiar with Jax, FL), and has CHA and new roof. I plan on retailing it.
I'll be using a HML, although I can't think of a good reason why other than I don't think a traditional loan could get done quickly enough.
Thoughts?
- Mandi
Tax records are useless for ARV.
you need 6m. to 1 year sold comps (max)
preferably in the same neighborhood.
And you also need to know what the repairs are. If you dont know how to estmate repairs take someone with you who does. And please do not use tax record for anything other than tax bill verification. Al Vars
And owner of record.
I would think that the tax record recent sales info would be much more accurate than comps from a realtor, given that you can get info from all types of sales regardless of MLS listing - and I don't have someone providing me with only the comps I want to see. Yes, it takes 90 days or so before something shows up online, but there aren't that many houses in this area - and many of them are sold FSBO (as evidenced by the yard sign - and verified by speaking to the nice old man cleaning his steps across the street).
Yes, the comps are all from the same neighborhood - same block, even. I've driven the entire street.
Yes, as I mentioned right next to the estimated rehab costs in my original post, I'm having the GC verify the estimated rehab cost.
I'm not too sure where the attitude comes from, but I assure you, I'm neither stupid nor attempting to waste anyone's time. I merely wanted an opinion on the numbers, slim as they may be. There are other costs involved, of course - holding, listing/buyer's agent, etc. - but I know there are folks here who can practically do that math in their heads.
With that in mind, how's the deal look?
- Mandi
69 Sell
-7 Purchase and Sell cost and commission to realtor
62
-12 repairs
50k
-( ) 6months holding cost
Util. Prop Tax, Insurance, Interest on mortgage or lost savings interest if cash
( )
- Income tax or capital gain, depending how you are structured
( )
- purchase $
( ) How much is left
divide into your time investment
and thats what I make per hour
I use several other formulas before I decide on a deal
But never take one under this scenario if It falls under 200 per hour
Thank you!
I don't think the intention of any of these posts was to imply that you were "dumb or stupid" however from your reaction I would say you are "young and inexperienced". I made my biggest mistakes when I was both of these
Tax records are not accurate or valid for comps. They can be used to help decide a property value but are not real accurate. I bought a duplex that the tax records said was worth 60K I bought for 35k and then petitioned the taxes every year for five years and got them down to 30K for assessment purposes and promptly sold the house for 135K. In most states of the assessment is not challenged regularly it will increase automatically. IF it is challenged then it may decrease below actual value.
Plan 6 months holding costs into your plan. Frequently things come up, closings are delayed etc. ON the face of it it looks doable.
Randall
[addsig]
Quote:I would think that the tax record recent sales info would be much more accurate than comps from a realtor, given that you can get info from all types of sales regardless of MLS listing - and I don't have someone providing me with only the comps I want to see. Yes, it takes 90 days or so before something shows up online, but there aren't that many houses in this area - and many of them are sold FSBO (as evidenced by the yard sign - and verified by speaking to the nice old man cleaning his steps across the street).
Mandi - nothing is better than comps from the MLS. You get to see what the house was listed for, AND what it sold for, AND how many days on market. Get yourself some MLS access any way you can.
I don't get this discussion.
Yes, the tax websites are good for comps. On many sites you can view the deed! You can see the Note, signatures and all. You can look at the stamp showing the excise tax paid ( will allow you to directly calculate the sales price.) Most sites update these listings daily.
I can't imagine why this information would be considered invaluable., and that only the MLS should be used.