Auction starting bid

[Jeremy England]

So there is a property on hubzu I'm interested in. REO auction that starts at 99k. ARV about 155k. Initially I thought it was a great prospect. Went by the house and estimated repairs to be about 26k.

Take away buying costs of 5pct plus title insurance etc (about 6-7k)

Take away holding costs of 3k

Take away selling costs of 11k

Take away minimum profit of 15k

Max offer 93k

Property is in a great neighborhood and LOOKS like its a paint/carpet rehab from the pics 

However, roof is 20 years old, ac condenser is 20 years old.  The roof LOOKS ok, but Im hearing appraisers are reducing values if the roof is 20 years old.  If I don't do the roof I could save about 4-5k

garage door needs to be fixed/replaced, windows need fixed/ replaced, appliances/cabinets need replaced, 2 exterior doors need replacing.  

Cabinets look ok from outside but they obviously had plumbing leaks and the interior of teh cabinets are all warped.  To sell for top dollar I think they need replacing.  Perhaps if you refinish the cabinets you save 2k

I could replace SOME light fixtures and save about 1000 probably, vs replacing all fixtures.  I could do the work myself and save another 500 probably.  Now we are talking time.  

So, If i cut some nice to haves out  I may be able to save 10k, but then I risk not getting as much on resale

That would put my MAO at 103k.

This house can be conventionally financed as well.  An owner occupant has a huge advantage because they don't pay selling costs or profit.  

Question would be if the bank would take an offer outside of the auction.