Which repairs will kill a flip?

[Craig Shrimpton]

All,

When looking at properties to rehab, which repairs are generally too much to tackle? For example, would you consider replacing the sills, the roof trusses, rebuild the foundation? In other words, at what point does the property become a tear down?

Do you always calculate the repair costs, or are there some things where you just say "forget it!"?

Thanks,

Craig

[J Scott]

I prefer to do two calculations -- repair and tear-down -- and see which numbers work out the best (or at all).

For a repair calculation, the rehab costs will generally be less, but so will the ARV. For tear-down, the build costs are almost always going to be more, but so will the ARV.