We retired in Jan and moved to South Florida a month ago. We have a huge amount of family here. We are renting a very nice 2700 sq.ft. house and are happy with it. We have a son who is about to be a junior and the schools are excellent here. Our plan is to stay here 2 years and then see what happens when he graduates. He has talked of joining the military. He might go to college. Who knows at this point? We have no plans of buying a permanent house anytime soon. Our plan is to start doing extensive travelling once he graduates. We plan to rent for 2 years and then depending on what our son does, put everything in storage and begin travelling by living in furnished places for a few months at a time in different places. After a year or more, come back to Florida, rinse and repeat.
We have been interested in flipping houses for a long time. I have quite a bit of remodeling experience. We don't need the money from house flipping. We are more interested in the challenge and of course the profit (if we do it right) will be nice.
The house directly behind us is a foreclosure. I have no idea how long its been sitting empty and have the real estate agent that found us the house we are renting looking into it. Its very close to the same layout as the house we are in but needs remodeled.
This is all VERY preliminary. Similar houses are going for around $410-$425,000 without everything being brand new. My original idea was to try to buy the house for $310,000 which I think is possible and put $40,000 into it. After fees and commissions I think I can make around $40,000.
This is a tough crowd who will find problems with any plan so I want to see what you guys come up with that I haven't thought of yet. What do you think of this idea? The biggest risk for any flip is that I cant sell it quickly or for as much as I want to get for it. If I time it correctly and it is done about the same time as our lease is over and we have problems selling it right away, we could move into it instead of continuing to rent our current house for another year.
We are renting for $2980. If we put $30,000 down on the house and $40,000 in cash for the remodel, we have $70,000 invested. Monthly payments including taxes and insurance will be about $2000 / month. We would be saving $980 / month over renting the current house which gives us a return on our $70,000 of 16.8% in that first yr. This doesn't account for income tax savings. Not sure how PMI works. I need to think more about that. We may need to pay PMI and then refinance once the remodeling is done and we have significant equity in the house. We would pay commissions when we eventually sell the house but that is already accounted for in my profit estimation if we flip it and sell immediately. Real estate is still recovering in S. Florida so its likely that we could get a better price if we hold it that extra yr. Price per sqft is up 7.6% since this time last yr.
Anyway, the plan would be to buy and flip, but do you agree that plan B significantly reduces our risk if the house doesn't sell quickly?
We have been interested in flipping houses for a long time. I have quite a bit of remodeling experience. We don't need the money from house flipping. We are more interested in the challenge and of course the profit (if we do it right) will be nice.
The house directly behind us is a foreclosure. I have no idea how long its been sitting empty and have the real estate agent that found us the house we are renting looking into it. Its very close to the same layout as the house we are in but needs remodeled.
This is all VERY preliminary. Similar houses are going for around $410-$425,000 without everything being brand new. My original idea was to try to buy the house for $310,000 which I think is possible and put $40,000 into it. After fees and commissions I think I can make around $40,000.
This is a tough crowd who will find problems with any plan so I want to see what you guys come up with that I haven't thought of yet. What do you think of this idea? The biggest risk for any flip is that I cant sell it quickly or for as much as I want to get for it. If I time it correctly and it is done about the same time as our lease is over and we have problems selling it right away, we could move into it instead of continuing to rent our current house for another year.
We are renting for $2980. If we put $30,000 down on the house and $40,000 in cash for the remodel, we have $70,000 invested. Monthly payments including taxes and insurance will be about $2000 / month. We would be saving $980 / month over renting the current house which gives us a return on our $70,000 of 16.8% in that first yr. This doesn't account for income tax savings. Not sure how PMI works. I need to think more about that. We may need to pay PMI and then refinance once the remodeling is done and we have significant equity in the house. We would pay commissions when we eventually sell the house but that is already accounted for in my profit estimation if we flip it and sell immediately. Real estate is still recovering in S. Florida so its likely that we could get a better price if we hold it that extra yr. Price per sqft is up 7.6% since this time last yr.
Anyway, the plan would be to buy and flip, but do you agree that plan B significantly reduces our risk if the house doesn't sell quickly?