Rehab Costs & Mold Issue

[Alejandro Tirso]

Hello All,

I'm dealing with the age-old and costly problems of MOLD and roof replacement.  I've read about identifying roof issues as a costly part of rehab (check. identified.), as well as been told by many non-investors that mold is a "nightmare" and to stay away.  I've read through the forums and J. Scott's "Estimating Rehab Costs" book and cannot seem to find a consistent answer!  Some say "Mold is gold" because everyone is afraid to touch the property and others say not worth it.  

Here is the situation:

Off-market, bank-owned property. Being it's off-market there is no listing price but estimated ~$140k. I'm having trouble calculating ARV because this is NJ and it's not a model development, meaning this home's structure is different than most in the neighborhood. Given its size and location though, I could see ~$260k being a fair estimate.

Being this would be my first flip/BRRRR (still TBD), estimating costs is my weakness (despite having read J. Scott's book). I've seen mold remediation costs upwards of $40k and in the book ~$10k. There is no question the basement is infested with mold, but it's unfinished meaning demo would be minimal. The realtor who showed me the place said it was because the home's been winterized and electric is off, therefore the sump pump has been off. Not sure if mold was there beforehand or that is the true issue.

As far as the roof, I'm looking at replacement costs around ~$8k I believe.  There seems to be mold in one of the bathrooms upstairs but a very small amount.  I imagine that's due to roof damage and leakage.  EIther way I'd lake to replace/update both bathrooms.  

The only other problem is I notice uneven flooring, meaning in certain bedrooms there is a gap between floor and the molding.  Seems like that could be a minor issue that can blow up into something costly, but again I don't know enough.  I know I need to get it inspected and all that to get best answers but anything would help!

Numbers:

"Asking" = $140k (considering offering $100k)

ARV = $260k

Construction Budget= $75k (am I shortchanging this.  it's NJ!  Roof, mold remediation basement, 2 bathrooms)

Potential CF after Re-Fi--Only $70/mo, but I'd literally be in the deal for no money at all after re-fi.  That CF is including money aside for vacancy, repairs, capex, lawn care, etc.