Second potential flip...Need help making a decision.

[Jake Thomas]

To buy or not to buy.

I have a house under contract for $92,500 (All Cash purchase) which has an ARV of around $150-160K. Repair estimates were originally $10,000 but now I just found out after a septic inspection the system was done incorrectly and un-permitted and must be replaced. I am getting estimates over the phone ranging from $8-14K for the type of system it would require.

Is this still a buy if I can get the seller to take $10,000 off of the sale price for the septic issue? The only benefit I see from the new septic (other than being new and done right) is I will just have the excavators fill in the crappy in-ground pool that hasn’t been taken care of in years while they are at it. But on the flip side the entire backyard will be dirt until next spring (here in Michigan) and potential buyers may not like that.

Purchase Price	$82,500.00
Repairs	$7,500.00
Pool	$2,500.00
Septic	$12,000.00
Holding costs	$500.00
Total cash invested	$105,000.00

My closing costs will be estimated around $7,000 with a sale price of $155,000. I am a licensed agent so I will only have to pay half of the commission plus transfer taxes and title insurance.

With that I am looking at a pre-tax profit of $43,000.

Should I go through with this?