Diary: Single Family - Land Park - Sacramento, CA

[Brennen Cook]

1317 1st Avenue Sacramento, CA 95818

Hello BP,

Here with a deal diary this time!

This single family home is located at the above address. It is currently a 3 bedroom 1 and a half bath house with 1378 square feet. Literally just closed on this house not even a day ago now.

This deal should be very interesting. Land Park is a HIGHLY desirable neighborhood near downtown Sac. Although I will admit I believe we are pushing the boundaries on this one I am very confident in the end result. Here is my basic evaluation. I try my best to be as conservative as I can that way to leave myself the most upset. Prepare for the worst....

ARV: $480,000+ ( Some comps dictate an even high $/SquareFoot )

Purchase Price: $320,000 ( Cash )

Rehab: $80,000 ( Interior/ Exterior )

Real Estate Commission: $23,000

Closing Costs, Taxes, Small Misc: $12,000

Conservative Profit: $45,000

Cash Out of Pocket: $400,000

Cash on Cash Return: 11.25%

Acquisition to Resale Time: 4 Months

Annualized Return: 33.75%

1317 1st Avenue Before Pictures

We will be converting this to a 3/2

My phone died while taking photos. More to be uploaded. That is most of the house. The missing pictures are of the back yard, screened patio area with laundry, detached garage. Pictures to follow.

When I comped this out it seems as the further you get away from 1317, the higher price per square foot gets. There is also a rehabbed property at 1325 1st Avenue that sold for $335 a square foot. It appears as if it was a minimal rehab and I know some of the construction cost had to go to unanticipated structural problems. Looked at property and spoke with neighbors

I think that an ARV of $480k or $348/ Square foot is being conservative for a well done, rehabbed and fresh product. There are some houses in the area that have sold for $400+ a square foot. I am not saying that is likely to happen here, but I could see a nice house in this area selling for $370 a square foot, easily. ( That is me with my fingers crossed and hoping)

I feel comfortable with this deal and the potential money to be made. I think on the conservative side ( which is what I try to plan for) there is decent profit to be made. I think property has some serious upside potential though! I would love to rehab this house very nice and it sell for $520k! =)

I would love to hear what everyone thinks. I plan to update this each week with progress pictures once work begins. Would love to hear opinions, suggestions, and ideas.

Do not be afraid to bust my bubble! 

I am posting this to learn myself and for everyone to potentially learn along the way. Please post any comments, suggestions, design ideas, anything! Know an architect? POST IT! Got an idea? POST IT!

Look forwarded to flipping this one with this diary..

Talk to you all soon!

[Chris Vail]

@Brennen Cook I am trying to figure out what you are going to do to the house that is going to push the value up to 480,000.  Two houses down at 1325 1st ave sold on 2/20/2015 for 410k  it was a nicely (completely) rehabbed 3 bed 2 bath granted it was only 1224 sq ft versus your 3 bed 1.5 bath that is 1378 sq ft however both lots are 5,227 sq ft.  I am just struggling with how you are planing to add an additional 70,000 in value over the house that is the perfect comp for the area of what should be able to expect.  Just playing devils advocate here as I can't wrap my head around what you could possibly do to add 70,000 in value.