First Duplex in Ft Worth - Rehab Needed

[Shane Bracewell]

Fellow BPers,

I have recently had an offer accepted (and renegotiated due to unanticipated repairs) on my first duplex in Ft Worth, TX. Below are the details:

$174,250 offer accepted on a 2006 duplex (4 br/2 bath per unit) in a C neighborhood. Inspection revealed many issues with plumbing, electrical as well as cosmetics. Therefore, the seller agreed to drop the price $10k as well as pay 2% in concessions at closing. Conventional financing for 75%LTV at 4.875% with 1.75% in origination fees, fixed rate over 30 years. I am assuming $12k in repairs which would mean total cash invested: $60,000. Anticipated rent (section 8) = $1350/unit and operating expenses (including taxes, insurance, PM, maintenance/repairs, capex) project to be $1100/yr. CF=$400/unit.

Investment returns:

Cap rate=10%

CoC ROI=16%

However, I need your help! I would like to bid out repairs to get a general idea on how much OOP these repairs will be. I can still back out of the contract until Sunday night. I would like to have an idea what my OOP repairs would be prior to making this decision. I have an inspection report but I am not sure which items need immediate repairs prior to renting or which ones can wait. Does anyone have a recommendation for someone who might be able to help guide me? Basically, I am looking for:

1) Someone to look at my inspection report to offer insight into what needs immediate attention as well as what would be the costs.

2) Guidance on how to get bids with an itemized list of immediate repairs and associated costs.

Any advice is greatly appreciated. Thank you!

Shane

[Joe Scaparra]

@Shane Bracewell  1) Someone to look at my inspection report to offer insight into what needs immediate attention as well as what would be the costs.

2) Guidance on how to get bids with an itemized list of immediate repairs and associated costs.

Any advice is greatly appreciated. Thank you!

If you are truly in Alaska, then you better have a Great Property Manager lined up because if you don't, you will be in deep Kimchee otherwise.  If not you then your PM has to handle those questions above.  If you don't have that taken care of,  then you have the cart before the horse and you need to stop and re-evaluate just what the hell your doing.