Can some of you help me with a cost estimation?

Question

All I feel bad for continuously asking questions.

I hope you will entertain more.

I keep getting calls from motivated sellers suddenly. I found this old sweet lady. So innocent, sweet, tired of her house and wants out. She has NO idea how much her house is worth, and at one point she gave me a ridiculously low offer.

I told her she should never do this... and I asked her to get her son involved. I felt so bad for her.

At the time I would never consider entertaining an offer so low. I will not take advantage of people.

But now that I do the numbers... I am shocked to discover that my max offer is in that low range.

The house is just that old, it needs a ton of work.

So I am asking you all what you all think?

THe house is so old, thee is no way to make it look new. But is that what we as rehabbers are trying to do?

What would you  change?

I am wholesaling this but I need to know how much it will cost to "fix it". But then to what extent would you fix it?

THe floors are messed up, walls are messed up, ceiling ... MESSED UP!

How much would I estimate repairs?

Pointers help?

Jerryll Noorden · Answer

After I relentlessly have been struggling playing with the numbers, that are just not working I realized something.

This house is built in the 1800's.

Instead of ripping all the crooked pieces of wall and wood and trimmings out, I should leave them.

The floors are just planks which I thought was hideous... but leaving them in would actually add "value" no?

Not only will this be more marketable, it is actually cheaper.

My question is,would any investor actually be interested in such a historic home?

Jerryll Noorden · Answer

Good points! Thank you!

I will look into it!

Dell Schlabach · Answer

Well I give you credit for tenacity, and coming back after you get beat up. That's what it takes to make it in this business.

The other thing is education, knowledge and experience.

If you want to come to Ohio for a couple days, you can hang with my acquisition manager/ realtor look at 20+ houses, run numbers on all of them. By the end of 20 some houses your comfort level on determining values, and MAO, will increase dramatically. You can borrow our one page analysis sheet that will allow you to run all your numbers in 10 minutes or less.

Other options I see, find a successful rehabber in your area, have him go to four five houses with you, borrow his analysis sheet, bird dog for him until you are comfortable, make a 1000 or so per deal until you are comfortable putting them under contract without him, then charge more.

Other option, pay him to teach you how he runs his numbers, have him set up seven reos to look at in one day, pay him if you need to, go with him and determine maos on 7+ houses in one day. You will learn 10times faster then asking the questions on bigger Pockets.

The questions about the extend if rehab, each rehabber will be different, if you find one or two good ones, look at their houses, look at what they paid, find out what they want, then deliver for them.

Fastest way to be successful, find out what your buyers, with money want, then supply that and you will never go hungry again