I have a meeting with a bombed out cabin.

[Darin M.]

greetings,

I have a potential purchase of a property that I am meeting with the owner next week here in the hill country of TX that is a 2/1 if you do not take the caved in roof into consideration.

On .2 acres

In subdivision

On city water 

On septic

Roof is severely buckled

Several broken windows

Property is trashed from what I can tell

And of course the owner when I talked with them said it was in great shape.  " have you seen the property recently?"  " well I guess it has been awhile"....

Taxed amount is $70,000 plus

Taxes last year were just over $1200

Unknown build date. Thinking 1950's buy the style since it matches my late grandfathers place.

My first thought is that I need an engineer to come visit to see if the building is salvageable.

Lots are going from 18,000 to 32,000 in this neighborhood

Comps for is area come back at the following

Sqft $95.50

Average selling price $62,500

This is the UGLIEST cabin in the area.

Here is the kicker

Most of the houses near by are actually about 1800 plus sqft and comp for $210,000

It will need the following:

• complete gut and remodel ($45,000)
• At least two dumpsters ($1000)
• The garage structure may not be stable?
• Several days of tree work or one big crew with a chipper ($3000)
• New septic system $20,000 (I think this area is solid rock)
• Hard money plus holding cost. 15,000

My thoughts on this property are as follows:

• offer $5000 as the cabin is a tear down with a Maximum offer of $7500
• Leave one wall in place and call it a remodel and bring this place ack to life as a small rental for grad students / retirees who are building their dream house and need a place to live
• Get the deal set and wholesale it off to one of the many builders in the area

My questions are: How do I price this thing?  It is a completely bombed out train wreck and I have never seen a house in this bad of shape. How would you handle this one? Am I missing any exit strategies?

Thanks in advance,

Darin