Analyzing Potential Deal for Buyer 26% Return Lubbock, Texas

[AJ Randle]

Okay BP, I need a bit of reasoning to supplement my analysis. Here is what i have from a lead that just came in. Backstory: Property Owner is a single mother who just lost her husband and is a single mother of one child. She bought a 3/2/1, 1148 sqft property nearly a year ago for $85,000 (built1978). She is ready to sell it and move because the property holds too many memories for her to bear. She financed the home with an FHA loan and 3.5% down.

Here is my thought of the deal. 

Thought process:

This is a minor fix-and-flip. First to maximize use of the property take the garage (264 sqft) enclose and vent it to make it one more bedroom which would create a 4/2/0. Then possibly makeshift a carport for two vehicle over the driveway, which brings the sqft to 1412 (not including the carport).

Repairs:

The repair estimate (in my novice mind) at the new sqft are about $12/sqft overall - $16950 (moderate repair budget). This includes new tile / carpet for the entire home. Staining the Kitchen Cabinets, Paint (outside & inside) the home, possible update the appliances with scratch & dents to save money.

Comps (high & low) in the sub zone:

Highest Sold (last 6 mths - 1 year)
$132500 for $95/sqft 3/2/2 @ 1400 sqft (new construction)
$93000 for $74/sqft 3/2/1 @ 1260 sqft (built 1980)

Lowest Sold (last 6 mths - 1 year)
$74350 for $66/sqft @ 1126 sqft (built 1975)

ARV:

I believe ARV is $120 - 128K.

$128000 ARV
minus 30% (for return)
----------------

$89600

minus $16950 repairs  @$12/sqft

-----------------

$72650 as offer price

(assignment fee..guessing $5k to leave skin on the deal for the buyer, hence 26% ROI net closing costs ($30280)

Any thoughts feedback, corrections? Heck, any interest. Please DM me your response. Thanks BP!