Pick apart my offers so the next ones are stronger

[James Masotti]

Hey guys...so far it's kind of been crickets on offers I've submitted for fix and flips. I know that a lot of people submit as many as 20 or 30 offers before they will get one accepted. REO's around here are ridiculously over priced here anyway...at least of course that's my opinion.

Anyway...here are the numbers on the deals I've looked at. All of the repair costs are estimates I've put together based on spending several hours at Lowe's and Home Depot getting material costs and using J Scott's book on Estimating Rehab Costs to ballpark the labor costs. I've bounced these numbers off my realtor, other local investors from my REIA, and two different contracts and they've said that they think I'm in the right ball park on these estimates. Let me know your thoughts so I can improve my deal analysis and submit stronger offers.

Each deal with have a separate post below this main one, to keep things a bit more organized and allow people to comment on specific deals.  Thanks again for everyone's feedback! Hopefully this will help me and other newbie's learn how to best submit our offers!

Some background on my financing too I suppose before moving forward with this...I am qualified for a HML at 4 points and 14.9% interest only for 12 months. However I have a private lender willing to fund up to on some of the costs at 10% interest on his loan value, for second position with no payments until closing (i.e. If I borrow $10k I owe him $1000 at the end whether I borrow for 3 months or 10 months), and I was recently qualified by a small local bank for a construction loan with 1 point and prime + 1% interest only for 6 months with an option to extend to 12. I also have some personal funds to contribute...so this all takes into account the best possible scenario I'm able to come up with for minimizing my holdings costs.

I guess my main question is...as a newbie...am I building in too much extra for into the "oh crap I really screwed this up and I'm totally going to lose my shirt" fund? Also the offer prices indicated are only starting offer prices and give me the ability to work my way up a bit if there's a counter offer. The rationale behind having such "large" potential profits...isn't that I'm greedy, but that I'm trying to budget for my screw ups...

However...I'm already factoring in 9 months to complete when I'm hoping it's really closer to 4-6 months. And I have a 10% buffer built into my repair costs. So do I really need an extra $5-10k (after expecting to come up on my offer price a bit) built into the profit as well? 

Thanks in advance for everyone's collective wisdom!

[James Masotti]

After Repair Value: $200,000

Closing Costs at time of purchase: $3,717

Monthly Holding Costs: $1,622

Interest Payments: $905

Property Taxes: $537

Electricity: $50

Water: $30

Insurance $100

Number of months holding costs: 9

Total carrying costs: $16,693

Repairs $84,272 + 10% Contingency = $92,700

TASK	UNIT	Materials Needed	Line Item Cost
Asphalt Shingles	Per Square	30	$6,600.00
Build Deck	Per SF	150	$2,700.00
Large Concrete Jobs	Per SF	1000	$5,000.00
Install Sod	Per SF	2000	$4,700.00
Roll-Off Dumpster	Dumpster	4	$1,400.00
Full Demo	Per SF	1000	$400.00
Service Call	Per Hour	16	$1,360.00
Natural Gas Hot Water Heater - 50 Gallon	Per House	1	$710.00
Replace All Supply Lines	Per Fixture	4	$800.00
Install/Replace Tub	Per Tub	3	$1,050.00
Build Tile Shower	Per SF	225	$4,387.50
Kitchen Sink	Per Sink	1	$120.00
Bathroom Sink	Per Sink	3	$210.00
Kitchen Faucet	Per Sink	1	$90.00
Bathroom Faucet	Per Sink	3	$210.00
Trim Kit Only	Per Tub	3	$390.00
Install/Replace Toilet	Per Toilet	3	$510.00
Replace Washer Box	Per Box	1	$175.00
Rewire House	Per Fixture	100	$10,000.00
Replace Furnace	Per Unit	1	$1,800.00
Compressor + Coil	Per Unit	1	$2,750.00
Frame Walls	Per LF	30	$360.00
Wall Board	Per SF	500	$580.00
Non-Wall Board	Per SF	500	$630.00
Exterior Door	Per Door	1	$800.00
Interior Door	Per Door	6	$1,020.00
Replace Window	Per Window	20	$5,400.00
Repaint	Per Floor SF	1000	$2,250.00
Paint New Sheetrock	Per Floor SF	600	$1,560.00
Install Kitchen Cabinets	Per linear inch	324	$5,670.00
36" Vanity	Per Vanity	3	$690.00
Granite Countertops	Per SF	50	$4,600.00
Install Solid Wood (Site-Finished)	Per SF	1000	$6,000.00
Install Tile	Per SF	700	$3,850.00
Permits	Per House	1	$200.00
Refrigerator	Per Appliance	1	$1,500.00
Range	Per Appliance	1	$1,200.00
Dishwasher	Per Appliance	1	$550.00
Microwave	Per Appliance	1	$300.00
Washer/Dryer Set	Per Set	1	$1,500.00
House Cleaning	Per House	1	$250.00

Commission to Realtor at time of Sale 7% - $14,000

Interest to Private Lender: $933

Offer Price: $37,000

Potential Profit: $38,375 --> Some factors about this one…it's on a busy road and there aren't a lot of similar style houses to use as comps, the house does sit on a larger sized lot for the area though. Based on this my realtor and I didn't have as high of confidence in the ARV, so I wanted extra buffer room on this one. House is in rough shape having been completely vandalized and he house next door is also vacant (trying to contact owners about buying this property as well), even though this is in a very desirable area.