First home purchase- Foreclosure for $54,900

[Katherina D]

Hi everyone!

This is my first ever post on BP. I am considering the purchase of a town home in my area in NC. This is a Townhome that has been foreclosed and is now on the market for First time home buyers at a cost of $54,900. The value for this home is currently at 110,000 and most of the homes surrounding it have sold for an average price of 102,000 within in the past year or two.

So here goes, the home had some mold issues. I'm not sure yet, what was the cause of it. I plan on going in with a contractor friend tomorrow. I know that all of the drywall has already been ripped out, and from what I understand it has been treated.

I am considering this purchase and then eventually having this become a rental property. The average rent in this area for a 3/2.5 is about $1,050. It is near a college and it is in a good area of town with great schools, I find that it is a very desirable area. I am pretty sure I will have to invest some money into it to get it back up to speed. I love this area, and I would love to live here. And I find other people feel the same way. The purchase of the home isn't open to investors for another 14 days. So I'm hoping to get everything done before then.

What are your thoughts?

And thank you for all of your help in advance!

[Jon Klaus]

Welcome to BiggerPockets, Katherina.

$54,900 is exactly the price I paid for my first house.

Townhome communities can have HOAs that can be a challenge for investors. Check out the costs and what the fees include and exclude. Also what limitations they will put on you.

Your numbers sound solid. Will this one rent for $1050? You'll want to find out total cost of remediation and rehab before you proceed, and then see if the numbers still make sense.