HELP! Fix and Flip or Fix and Hold? Lender Recommendation??

[Tasha Barnes]

Hello All, 

I plan to make an offer on a duplex today. I was undecided if I wanted to fix and flip so I'm leaning more towards Fix and Hold since the property sits on 2.5 acres that can be subdivided. The property is in need of some repairs before I'm able to rent it.

The home is in a good location and shouldn't have an issue cash flowing it or I can fix and flip and move on to my next project. Decisions Decision Decisions....

Any lender recommendations for fix and rent deal?

Tasha

[Erin Azar]

Please make sure you check with a local Civil Engineer (that does developments) what the rules are around subdividing in that city/county. Not all properties can be subdivided as planned for future development for a variety of reasons such as local regulations often limit the number of times a single parcel can be divided up for development. If this requires septic (vs sewer) then there are other considerations also, such as minimum acreage required for septic/well (usually one acre per lot), which areas could the septic be placed (usually needs to be placed in areas of undisturbed soil, meaning wooded areas are off limits, even if cleared), soil quality to pass for septic, location/topography relative to road given grading of land, frontage required for each parcel, turn radius for ingress/egress which may limit developable area, driveway relationships to neighboring roads/intersections, etc. Local setbacks from front, rear, and sides are also something to look into. Nothing to be afraid of, but my firm works with landowners and developers regularly, and these are discussions we guide them through while designing their plots. Sometimes investors buy land that only permits a limited number of houses/buildings and it was not what they thought they bought originally.

Hope this helps!