Strategy for first RE Purchase: SF Seme-Detached Home

[Mike Soofian]

Hi BP Members,

Haven’t been actively pursuing my first deal but came across an interesting find for my area. Semi-detached home needing what seems to be a total rehab.

Asking is 279k -1,928sqft

From my research, similar homes (sqf and room/baths) are selling for about 340k on this block. Almost all semi-detached homes.

Guestimating about 100k repairs... new boiler, hot water tank, refinish hardwood floors (there’s currently thick red substance on it, I think that was from the carpeting that was pulled off), new fixtures and lighting, total remodel kitchen + appliances and bathroom, converting 1 or 2 half baths into a full (see below). Also would like to redo siding of the home

My plan thus far is to call a get an inspection this week, create a scope of work and get bids before the end of the week. Also, going to go to two mortgage brokers and try to secure a 203k loan.

Make an offer next week.

It’s not zoned for two family but the walkout basement is large enough to be converted to a studio. I know people here like to say to go by the book (which I actually agree and prefer it that way!) but wondering if that’s worth the investment. Maybe there is a work around for example, short term Airbnb type rental... I don’t know, just throwing this idea around to possibly increase value. I like the idea of the studio and renting out the upstairs because I intend to get married within a year and think this would be a way for me to get a place for us to start out and gain some home equity!

Also, only need to convert the downstairs half bath to a full if I endeavor for the studio idea.

Thoughts and suggestions. My outline sound?

My dad has some experience with RE but still wondering if I’m in over my head...

My money situation FYI:

24k- Portfolio Investments

13k- Cash

54k- 401k

Steady income of $3.5k/monthly after taxes