In Contract! Should I close?

[Alexander Reda]

Hey biggerpockets family!

I was hoping to get some input on this deal I'm in contract with. This will be my first value-add property that I will be purchasing out of state. 

I am purchasing this for $78k.. The market shows that my ARV could be anywhere between $120- $135. Bellow is the breakdown of the property.

ARV: $120k

REPAIRS: $25k-- Contractor says he can do it for 25k but "nail on the head is 30k."  he told me to have a contingency of 5k which I don't know if its a good thing or bad thing for a contractor to tell me how much I should have in reserves. I planned on having a contingency of 10-15% extra on the 25K repairs but that kind of through me off when he gave me his input. Should I expect it to be 30k in repairs now? The work should be done in 2 months but I based the rest of my numbers on 3 months. 

Holding-$3,860

Closing-$1,500

Total Cost: $35,360 (assuming 30k in repairs)

I will be doing a cash out refi (80% LTV) into a 30 year fixed rate. Keeping this property as a rental.

Rents in the area are between $800-$975.

With my finishes I should be able to get around $850-$925 for rent...

Do you think it is a good deal for an out of state investor on his first deal?

Thank you for your feedback!! 

[Jonathan Greene]

@Alexander Reda you are doing what many new investors do, you are asking for input and then basically dismissing most of it based on your estimates. But you don't have the experience to make these judgments. If you decide to go for it, best of luck, I am sure we are pulling for you. But chances are you are going to come back to this forum and wish you dug a little deeper on what we were saying. Just because you spent two months building a team doesn't mean you have to buy one. Your team is built on excess costs that you can't verify. A GC from online and a PM company you hired online - not a good setup to reduce skimming on a flip and hold.