Fix n Flip 4+/2+ home in Chicago

[Mark Shaffar]

10512 S Eggleston, Chicago

4 bed plus 1 in basement

2 Bath plus 1 in basement (we are adding a bath on 2nd floor and basement)

Finished Basement

Brick Cape Cod

Pics:

https://www.dropbox.com/sc/rffv1ygzmdo69p5/AAC2gUMbWUENZhUGAGI92NbGa

Price: $45K (includes our management fees for the project)

Rehab: $95K (We are redeveloping portions of this property)

After Repair Value: $185K (what we estimate it will appraise at)

Projections:

Price: $45K

Rehab: $95K

Resale: $185K

$185K Resale

-$45K

-$95K

-18K Selling Costs (6% Realtor, 4% Buyer's closing costs at resale)

-$3K closing costs (at resale)

-$2K Insurance / Utilities / lawn care

$17k net

Recap: Invest $148K and Net out $19K = 12.8% on the project / annualized = 25%

These are totally a passive investment, we handle 100% of the work.

Additional Notes:

The average list price is this zip code

is skewed for a couple reasons. The areas we invest in some pockets are more rental areas and other areas in the same zip codes are home owner blocks. Therefore the average distress property is trading at 30k and held on to as a rental. Therefore, holds average down. The other factor is we are redeveloping these properties. This particular project, 80-85% all new electrical, all new plumbing with exception of the stack/stink pipe, new hvac(75% new duct work), keeping half the windows, roof layover. In addition, the kitchen will be opened up into a function suburban type feel, bathroom added to the 2nd floor, bathroom and bedroom added in the basement and the basements are finished off tile floor and family room. These projects are high end for the neighborhoods, therefore we get top dollar for them. However, you can see the comparables we sent support similar style houses, with similar beds and baths are trading at that number.

$155k in 2006. It sold for that number without a bathroom in 2nd floor, tile ceilings on the 2nd floor and basement was "Finished" but it wasn't really finished off as a living area like ours.

Our Realtor

sells 250-300 houses per year in these areas. They have set the standard for rehabs and we get top dollar for them. If we do a lesser rehab, buyers look at our property and compare to the high end property. Example: Lower end rehab:150k 4 bed/2 bath…buyer would rather spend $160k on a 3 bed/1.5 bath to have the amenities. 

Example Finished Products we've done in this area:

https://www.redfin.com/IL/Chicago/10508-S-Peoria-St-60643/home/13075337 finished product

https://www.redfin.com/IL/Chicago/8347-S-Dorchester-Ave-60619/home/13221363 finished product