Help !

The numbers seem decent on this potential deal

$150k ARV
*.70
=$105k
less $40k rehab
less $10k your profit (just plugging in a number)
=$55k max offer, which is in the range of the $47k she wants.

Next steps: sharpen the numbers, make sure the ARV is $150k. Make sure the rehab is $40k (for a full gut, that seems light).

Then determine what you want to do with it. Are you buying it for yourself? Assigning it?

Good luck and let us know!

- Tom

The comps gave me an ARV of 170k. However, those sales are from '09 & '12. Just this year the market value of these home's jumped about 110k. From 37k dating back at least 6 yes to being assessed somewhere around 120k. Does this affect the ARV ?

Those comps are too old. Sales prices can change dramatically and thus your ARV. Is a realtor giving you the comps ? Or are you compiling them and if so what r your sources? It's best to get up to date comps and within 1-1/2 mile radius. Make sure it's within plus or minus 20% sq ft. Stay up to date with what's being sold in your target area and how much per sq ft and you will be more and more inclined to know a deal when it comes up ) keep in the game and stay in tune with the comps. Way to make something happen !!
Jay

Before you think any further, you may want to go down to the local title company and get a title search completed. You may pay off the taxes, but there may be other liens against the home as well. It is always best to know what skeletons maybe lurking in the closet (another reason to bring a licensed general contract to give you a rough idea to the rehab costs).

Nihjer - as Jay mentioned above, you definitely need more recent comps to accurately determine ARV.

Any update on this potential deal?

Wishing you the best of luck!

- Tom

Question: Would I be able to find that information on my own?

The way I ran the comps before was from a list of homes on the same block as my property on Trulia. Then running the adresses thru the city's property search.gov for the sale prices. I don't know of a website that would allow me to adjust the settings for homes a mile and a half out this particular home on top the other filters that they provide. The only websites I use and know of is Trulia, Zillow, or Realty. Its looking like more and more homework. Is this done manually if I don't have a realtor doing them for me? Like literally sit and figure what homes are a mile out from my property then see what they were sold for?
Also, should I hire a lawyer to negotiate the property taxes on the home considering the amount? Thanks for the help

Hi Nihjer - I had always used a realtor to run comps in the past for me, although you can use Zillow on sold comps in the immediate area to get a rough estimate. Yes, you should find a comp that sold within a 1 mile, within the last six months, and adjust according to the square footage. Always drive by the comps and check for condition and adjust for that too. If the comp is right by the railroad tracks and your potential house isn't, it's prob not a great comp.

Regarding negotiating property taxes, I've personally never seen a reduction in property taxes owed. I'd also check the $47k number. Most towns won't let you get behind more than 2 or 3 years before doing a tax sale, so $47k seems like a lot.

Finally, as mentioned above, fine tune your rehab number too. I've personally done full rehabs before, and my average is about $40/SF, inside only. So on a standard 1200 SF house, that's $48k.

Good luck!

- Tom