Deal or No Deal

[Alberto Cordova]

Hello BP,

I have a questions on a deal that I am looking into at the moment and I would like to get as much feedback as possible. 

The property is an ugly home located downtown the asking price was 20K but due to family issues with the seller they are letting it go for 17K. The repair is going to be about 6K and ARV is 36K. The contracting work will be done by the sellers since they are contractors. They stated they had originally gotten the property to turn it into a rental but as I mentioned due to the family issues they now need to sell it. I looked at the property at the moment it is a 1 bed 1 bath and they where going to make it 2/1.

Sgft: 600

Bed: 1 (after renovation will be 2)

Bath: 1

Year Built: 1950

Misc: I need minor feedback, I am not sure what it can be but on the side of the property on the bottom there is black stuff around the home. Could this mean possible flood zone?

My questions are would this be a great deal? The factors I am considering are how long will it be before I sell the property? It has no garage (cars have to be parked in the sidewalk). It is a small home so I am not sure weather a family would be interested also since it is semi a busy street. ( Am i thinking right? or am I just over thinking things?) One good thing is that is about 500 ft from a police station. If that even matters.

My strategy would be flip the property, wholesale, or rental. I was thinking to do seller finance but since I will be using the money from a private lender, I want to be able to pay him asap.

Thank you all in advance for any assistance.

[Chuck B.]

I'd be very worried about using the sellers as your contractors.  Are you sure they're repair estimates are solid?  Do they do good work?  Have you worked with them before?  

The next question you have to ask yourself is what is your PLAN B.  If Plan A is to flip it and make a few grand profit, what happens if you can't?  What's the rental market like in that area, what will it rent for, and will you be OK dealing with the typical demographic in that neighborhood?

Best,
 - C