Chicago Rehab Numbers to Determine Purchase Price

[Travis Russell]

I'm looking at a 2/1 condo that needs some reasonable renovations. It's in a good area that's going through some regentrification. Lots of families and close to public transit.

700ft2, large bedrooms, small bathroom, small kitchen. It has original hardwood floors (but I think the subfloor needs to be replaced), w/d hookups in the kitchen which I want to relocate to a hallway directly on the opposite side of the wall, and a door to the furnace in the living room that I'd like to also move to a hallway wall to reduce noise.

Kitchen isn't laid out the best so opening up the kitchen and updating with new cabinets and countertops is necessary. There is one short non load-bearing wall that needs to go in order to expand the kitchen. Aside from that, replace the bathroom vanity and bathtub, and depending on the costs for everything, I'd like to update the tile in the kitchen and bathroom. Windows are good, plumbing is good, and electricity I believe is fine.

Expecting the renos to come in around $12-15k (again, small condo, small kitchen, and standard fixes). Cash purchase with minimal holding costs: taxes, HOA ($200) and insurance. ARV from a recent CMA estimates it at $115-$140k, but more similar size/style property comps are $85k (closed 12/2013) and $90k (closed 3/2014). With the market heating up, I'm expecting the ARV to come in closer to $100k if I'm being realistic.

Are my numbers reasonable? And if so, what would the max purchase price be that you'd safely go in at? The price I fear will come in a little over the 70% rule! But I really need to get on a project so I'm willing to go into an easy flip that may yield a slightly lower return just to get some money coming in.

Thanks in advance!!

[Brie Schmidt]

@Travis Russell - Based on this info I would be using the $90k ARV - depending on the area condos are a dime a dozen and I have seen so many condo owners recently thinking that the market heat up was inclusive of condos and were sadly disappointing - but again, just my 2 sense. Feel free to PM me the address and I will comp it