TheFed just picked up a $85k home for $17k......yep, another one!

[thefed]

TheFed just picked up an $85k home for $17k......yep, another one!

This home is slightly less roomy than the other and has its own bit of problems...but I'm excited nonetheless!

Tax appraisal is 85k, and I can realistically see it selling for 75-80k in a couple years (need to keep it at least 1 yr for capital gains treatment). I anticipate a budget of $18k going in....but we will finalize that in the coming weeks. More big things need done here...new heat/AC, h20 tank, kitchen cabinets, counters, taking out a wall, some windows etc etc.

I'll take some before and after pics again...

 

[ERD50]

capital gains:

Just make sure you have a rough number of what short term vs long term cap gains would mean to you. You don't want to lose a good offer - be ready to weight the offer against the actual tax $ diff and the risk of not getting another offer at greater than the diff. IOW, you don't "need" to keep it > 1 year, you may want to if the economics/risk make sense.


Remind me - did you sell your other one yet? Renting it out?

-ERD50

 

[Notmuchlonger]

Hey man! I love to see this kind of stuff. Pics and numbers. Good luck to a great flip!

 

[thefed]

capital gains:

Just make sure you have a rough number of what short term vs long term cap gains would mean to you. You don't want to lose a good offer - be ready to weight the offer against the actual tax $ diff and the risk of not getting another offer at greater than the diff. IOW, you don't "need" to keep it > 1 year, you may want to if the economics/risk make sense.


Remind me - did you sell your other one yet? Renting it out?

-ERD50

Thanks for the input. I have a pretty rock solid business plan with my partner and business agreement that spells out how our 1st 3 deals must go unless we both agree otherwise...so as of now 1yr is the minimum we will hold. B keep in mind that he is in the highest tax brackets so it makes more sense for him ... so it was a negotiating point when we worked out the details.

The other one is rented for $700 /mo and the tenant put down a few thousand toward a lease option in addition to a few thousand in upgrades that we split with him. I can see him getting a mortgage within the 2 year option period

 

[Bestwifeever]

Sounds like another successful venture for TheFed! Glad your arrangement with your partner is working out so well.

 

[samclem]

More big things need done here...new heat/AC, h20 tank, kitchen cabinets, counters, taking out a wall, some windows etc etc.

Regarding the furnace and A/C: Lots of folks will be replacing theirs with high-efficiency ones in the next year--some already have. You could probably get perfectly serviceable used equipment for a song. Maybe contact some HVAC contractors in your area.

 

[dixonge]

This home is slightly less roomy than the other and has its own bit of problems...but I'm excited nonetheless!

Tax appraisal is 85k, and I can realistically see it selling for 75-80k in a couple years (need to keep it at least 1 yr for capital gains treatment). I anticipate a budget of $18k going in....but we will finalize that in the coming weeks. More big things need done here...new heat/AC, h20 tank, kitchen cabinets, counters, taking out a wall, some windows etc etc.

I'll take some before and after pics again...

Just please tell me the investment fund checking account requires more than one signature.....

 

[thefed]

Regarding the furnace and A/C: Lots of folks will be replacing theirs with high-efficiency ones in the next year--some already have. You could probably get perfectly serviceable used equipment for a song. Maybe contact some HVAC contractors in your area.

never really thought of this...i have several hvac buddies because i am in the industry...i'll make a few calls today! an 80% efficient would be fine for this, although i can buy a decent 80% for this sized home for only $600 new...

 

[tryan]

Fed,

Congrats!

Another HUD home? Just curious, what was the list? I've only been able to get hud to budge 10% off the list. Then they let it sit for another several months ... some times tied up with buyers thinking they'll get financing for these gems (which doesn't happen - uninhabitable).

17k is a no-brainer! I am throwing 50-60k cash at listings in the 85-115 range. Not happening ... yet.

 

[thefed]

Fed,

Congrats!

Another HUD home? Just curious, what was the list? I've only been able to get hud to budge 10% off the list. Then they let it sit for another several months ... some times tied up with buyers thinking they'll get financing for these gems (which doesn't happen - uninhabitable).

17k is a no-brainer! I am throwing 50-60k cash at listings in the 85-115 range. Not happening ... yet.

this was actually bank owned and on mls. it was listed at 25k for about 4 weeks. nobody, including myself, realized the OVERGROWN abandoned lot behind the garage was part of the parcel (i assume). Without it, there is NO back yard, and a small un-unusable side yard. That would've been the biggest drawback besides only one bathroom.

Leave it to my partner to add another project however....we are now putting a 1/2 bath in the upstairs to create a master suite. $$$$$$!!!

 

[thefed]

324 e huston pictures by thefed17 - Photobucket

BEFORE PICS

 

[modhatter]

Where are these located (city, state) Just curious what kind of neighborhood it is, in terms of finding good tenant.

 

[thefed]

barberton oh. it's really hit or miss with tenants in the area. This neighborhood is pretty well kept...all the neighbors take care of their properties...

 

[Moemg]

Pretty nice house for that price ! Have fun with your redo!

 

[thefed]

We are using a lot more contractors on this one vs. the last house to help me keep my sanity (and ambition!).

We signed on Friday. The whole house has been re-plumbed, water service is on, electric is on, gas will be on tomorrow. The new upstairs bath has been roughed in. 1/2 of the demolition is done.

TOMORROW:

DUMPSTER ARRIVES
ENTIRE MATERIAL LIST DELIVERY COMING FROM LOWES
GAS BEING TURNED ON
FURNACE BEING INSTALLED
LANDSCAPER FINISHING UP 4 DAYS OF BRUSH CLEARING, VINE-RIPPING, AND LEAF RAKING

TREE COMPANY COMING FOR ESTIMATE ON EXTREME TRIMMING NEEDS
DEMOLITION TO BE COMPLETED

WED:

Exterior painter starts
Framing of new bath, and kitchen walls to beging

 

[harley]

I hope you are planning to keep the interior paint colors. I like that room with the orange, lavender, and turquoise color scheme.

This one actually looks better than the first one to my uneducated eye. Good luck on the project.

 

[thefed]

I'm really excited as we are moving along well. Demo is done. Cat urine stained floor cleanup is underway each day (bleaching, vinegar-ing, enzyme-ing, disinfecting) only to be following with 2 coats of shellac. Upstair bath is framed, and all re-wiring in upstairs is re-done (adding 3 can lights, a bath fan, one switch and one plug tomorrow - fixtures only). Roof is powerwashed and needed it BAD. Trees are all trimmed....best $550 we spent so far. 2 sides of house are painted. New furnace and all new ductwork to be completed tomorrow.


Aside from all that, considering the things I already mentioned (replumb, rough in, etc), I think we are in great shape for 7 days of ownership. I hope we can keep up the pace.