OfflineI have this opportunity to buy a home that normally sells for $90K for $20K or below (they just really want to get rid of it)
The problem is that the house has issues. It's older (1880s) and the person who lived in it didn't take care of it (the 2nd floor has a gaping hole as I can see through the window and the neighbor told me it was a water leak) It's going to take awhile to clean it up as well.
I'm wonder if it's all worth it. What if I can't afford to fix it up? I can pay cash for the initial cost, but I don't have a ton of money to dump into it and I'm not at the level where I can afford to just give away money in a loan if my income doesn't go up.
Yes, I'm a little scared. haha. I'm afraid that if I don't buy the house then by the time all the books and stuff come that it will be gone and I would have lost a great deal.
Figure out how much will all the repairs cost you. Offer 5K for it. Let them counter. If they start saying something, remember it is an old house with need of repairs. BUT YOU MUST KNOW WHAT YOU WILL END UP SPENDING ON REPAIRS.
Get a contractor there and let him tell you what the bill will be.
Yuri
-- TIME IS A TERRIBLE THING TO WASTE, SO STOP WASTING IT --
I am going through the same thing, as I loked at a home with a bad roof and issues early today. However, the home I looked at was built in the 1950's. I will probably take everyone's advice and offer around $5k and see what happens.
In your case just make sure you estimate expenses and be conservative an estimate on the higher side. Sometimes things can cost a little more than you think. Also, factor in carrying costs, during the time you are fixing the home. Good luck on this deal. Believe and Achieve!
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Also, is the surronding area nice houses? It should be in a good area. Also Maybe you can see if the owner is open to seller financing for a year or so, that way they hold the mortgage, you will have your money and some time to fix up the place, then refi down the road. Good luck and keep us posted.
Jeremy
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This train, Faith will be rewarded
Big wheel roll through fields where sunlight streams
Meet me in the Land Of Hope And Dreams
Bruce Springsteen
definitley find a good contractor to give you an estimate.
If this home has moisture or foundation problems. Repairs can be very expesive!
I wouldn't pass p the opportunity to buy anything that cheap in price. I would offer 10,000 and shoot for 13 or 15 thousand. Depending on the town you might have some restrictions placed on what way you can restore a house of this age. The repairs can be higher than usual. But there's a buyer for everything. It sounds like it might be best to buy it with the intention of selling it immediately to a investor builder. At a low offer such as 10 thousand or 15. Having the land should be worth it. How's the location? Someone might be looking for something in particlar in a home and can't find it. So building new might be an option for buying it soley for the land. So you sell it for 20 or 25 thousand and still make a profit. A 100% or 50% return is still better than none. Continued success.........Lubertha
"GOD IS STILL IN CHARGE, HE IS THE AIR WE BREATHE"
that's true. the property taxes are so extremely low that even if i kept it a few years it would still make money.
i know my kids wouldn't want to live there--it's right next to the police station and my son has a garage band. LOL
i love the attitude here.
it's a great thing when an opportnity like this arises. So take advantage of it. Continued success.....Lubertha
"GOD IS STILL IN CHARGE, HE IS THE AIR WE BREATHE"
SOUNDS LIKE THERE MAY BE SOME EQUITY IN THIS PROPERTY .GET 3 ESTIMATES FROM CONTRACTORS THAT PROVIDE FREE ESTIMATES ! REPAIR ESTIMATES FROM CONTRACTORS ARE LIKE GETTING A QUOTE FOR INSURANCE OR PRICES ON AUTO PARTS OR ANYTHING FOR THAT MATTER THERE CAN BE A GREAT DIFFERENCE IN THEM THAT COULD EFFECT YOUR EQUITY AT THE END THAT U HAVE TO WORK WITH. TALK TO THE CONTRACTORS ABOUT THE ESTIMATES AND YOU CAN LEARN ALOT ABOUT THE REPAIR ,WHAT TO LOOK FOR AND SOME GREAT INFO ON HOW TO PROCEED WITH THIS DEAL OR ALL THE OTHERS IN YOUR REI CAREER.
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I would invest in a mold test. Mold usually follows a leak that has not been repaired. If mold is present, I would get an estimate from a few contractors to clean up anything you are unable to do.
I would buy the property with an offer of 10,000.00 and then flip it to
a rehabber for 25k.If the house would normally sell for 90k,and a rehabber
puts in 35k for repairs,he would still profit around 30k and could make
around 15k.
whurndon