Fix up or sell as is?

Question

Hello, I've been reading around on these forums for a while and finally decided to post. I've been interested in real estate since I was younger and even now would like to get more involved. (I just have to take the state test here in AZ and I'll be licensed.) I am not sure what I should do at this point and could use some advice. Also, please move this post if it is in the wrong forum.

Right now I live in a small (~1300 SF 3/1.75) home. I bought it in 2010 when the home prices were a little cheaper and there was more inventory. I knew that the prices would go up eventually and wanted to own something before that happened. Being only 22 it was actually cheaper then renting an apartment (I had a room mate who paid basically the loan amount as rent every month). So I bought it with an FHA loan, I owe about 62k@ 4.75%.

I originally was hoping to do a little work here and there, but haven't done much at all besides paint and changing some faucets and light fixtures. I wanted to get new flooring, replace the old windows and doors with more efficient ones and then later on remodel the bathrooms and kitchen. This is the same house I have, its on the next street over, but it has been remodeled: http://webcache.googleusercontent.com/search?q=cache:okcAPAs7M4gJ:www.movoto.com/az/1017-s-cochise-cir-mesa/471_4852815.htm+MLS%234852815&cd=7&hl=en&ct=clnk&gl=us&client=firefox-a

I can't seem to find if the listing is active, or sold, but If I could fix mine and sell for that much, I'm sure I could make a profit. (They bought the house a few months ago for 67k)

Anyway I'll get to the point. One day I was in my back yard and I noticed some small cracking in the brick, (house is slump block) I didn't think much about it, but it seems to be getting worse. (haven't noticed any interior cracks) At this point, I have no clue what to do. If the foundation is the blame I don't have the money to pay for the repairs, so I was thinking of selling it and hopefully just being able to get out of the house for what I owe, but I would love to remodel it similar to the house that I linked above, when my finances get better. I could possibly borrow some money from family to fix it, but not sure if it would even be worth it at this point. I also noticed similar stair stepping cracking on the neighbors house (recent foreclosure sale, currently being remodeled. He (new owner) just filled it with some type of cement, so I'm not sure if that is an option for mine. I guess the first thing to do would be to call out some foundation repair people?

Here are two pictures that I took today:

[URL=http://img152.imageshack.us/i/photo2eb.jpg/][/URL]

Anyway, any advice would be great! Sorry about the long post! (and I wasn't too sure how to add pictures, they look very small so I tried to make another link to make them bigger)

-Bryan

Bryan Smith · Answer

Thank you for all the advice everyone. I will try and get it looked at, hopefully it's nothing too serious!

Account Closed · Answer

u may want to get a comp done by a top sellg agent who knows ur area well. in fact, contact the agent that just sold the neighborg property for their opinion n comps while ur tryg to figure out details bout what to do w ur home. that home u just showed us for sale (pendg status) has been rehabbed... I'd guess ur in the ballpark of 90-120k wo knowg any other details than what uve mentioned tho. also looks like someone flipped that prop in ~2mos, buyg at 67k meanwhile, I agree get quotes for that wall n maybe some other thgs ur considerg rehabbg while ur at it. just my $0.02...

Tara G. · Answer

cracks along grout lines are common in block or brick (neighbor's house). It is more serious when they run straight through the block or brick. Observe the crack, if it is getting worse, you definitely need to do something about it. If it doesn't get worse for some time, it is done settling and you can just repair the block/ brick. if it is 1/2" or more, you will need foundation repairs or it will show through to the inside, eventually. Get it looked at by an engineer, you will find out if you need to repair it. If not, you have a clean report to show potential buyers. It usually costs about 300$.

Account Closed · Answer

I agree with Zing on this 1k to 3k to rebuild this wall maybe 5k max so long as the problem isnt a grade issue. Get some estimates from contractors and have them talk to you about it. Then you will have more info to go on. If 140k is what your house is worth arv then its worth it to do the work and make some money on the back end. Your exit is a lot easier without foundation problems and this one doesnt look too bad. I have not seen the rest of the property and there are not many pics here. Are there any large trees encroaching on that wall or nearby? I once bought a similiar 2 bedroom w block foundation and walls like this. They built a lot of these homes during ww2 into the late 50's. If you have more pics and some farther back from wall i could see grade issues if there where any. Having estimates will also help you prepare for fix and repair costs.

Xing Zhu · Answer

This type of problem requires one thousand to a few thousand dollars to fix. You can also observe for a few months to see if it is getting worse. If not, you may leave is alone.