Help Me Analyze This BRRRR / Flip Opportunity

[Steve S.]

I own several rentals and am tryign to get more into rehabbing and BRRRR or Flip. I've done light rehabs but this one will be much bigger. Here are some details followed by some pictures.

Yr Built: 1975

Sq Ft: 2250

3 BR / 2 BA

.75 acres

Easy highway access in top school district in the area 

Asking Price: $126,000

ARV: $205,000

House on the same block from same year and same size / configuration sold for $205,000 18 months ago

Key Issues:

- Foundation - common in this part of texas for this age.  Cracks in bricks outside and in the ceiling

- Wood paneling throughout

- Needs new roof

- A/C probably should be replaced

- popcorn ceilings throughout

Comes with a shed out back that needs some work but could have some appeal

I'm thinking this has at least $50,000 worth of work

- $15,000 foundation

- $10,000 roof

- $5,000 kitchen

- $2,000 un-popcorn the ceilings

- $5,000 replace wood paneling

- $13,000 general other things I'm not thinking of but will happen

What are your thoughts?  Would this be a good deal?

Here's the pictures

[Nick B.]

$126K+$50K=$176K all-in cost.

If you sell for $205K you would make $31K gross profit. 

Are you going to use an agent to sell? If so, you will pay between $5K (flat rate) and $12K (6%) in commission. This reduces your profit to $26-$19K .

How fast do you want to sell? If you buy it with hard money loan your clock is ticking and you may not sell at the highest price. 

Also, the cost of hard money ($5K easily) should be added to your basis making your potential profit even smaller. 

On the flip side, how precise is your repair estimate?

Does is really cost $15K to fix the foundation? Did you get this number from a foundation company? 

Same with the rest of the list.

Maybe it's enough to spend $20K to make it rent quality instead of retail quality and sell for $175K to a rental operator or keep for yourself. 

I know it's a "non-answer" but I hope it would stimulate your creative thinking.