Investment Gone Bad - Need Exit Strategy

[Ed J Petrus]

I'll try to keep a long story short here but I need some opinion on how to exit investment gone south:

A family member (A) purchased a property for another family member (B).  The intention I believe was to fix, move in, and sell their current house and pay back family member A.  Family member B didn't complete the repairs, stopped paying some of the bills, etc.  It is almost 2 years since the purchase.  Family member B is now out of the picture now and I'm trying to help my family member A who actually owns the property.

The property was a condo 4 bedroom / 1 bath foreclosure in a 6 family building.  Purchased for 40k cash.  I'm a general contractor and the property needed a decent amount of work.  I thought if the repairs were kept minimal and done quickly the deal could work.  As of now, the property has been in holding too long and some contractors that were hired did too much demo. So now it would need even more capital to repair. 

At this point I estimated 60k for repairs to do the work and get paid for it as a contractor.  

ARV of this property I believe is around $120k. I've had 3 realtors look at it and they seem to give a range of $120-$150k. However, there are no comps as this is a unique property type. Most condos in the area are townhouses with many amenities and go for $225k. Other similar size properties are houses with yard, driveway etc. The realtors all had challenges pulling comps.

This condo has no parking, high HOA fees ($400/month), and overall building needs updating. Which could make for a tough sell.

Right now my family member wants to sell as is and not have the headache but I'm curious if there is a creative way to solve the problem.  

Right now we are under water around 70k.  If we put in the 60k repairs and sell for 120k, we are -10k.

Possible to rent it out and refinance?  Any other creative ways to exit this situation?

Please let me know your thoughts and if you need more information.

[Andrew B.]

You're thinking too hard. ignore past costs as those are sunk. they should not drive today's investment decisions.

What can it sell for now? What can it sell for after $60k or work? (Also, how confident are you in that number being all inclusive?) Lastly, what can it rent for after fixing it?

Those are more important than your relative's purchase price.