Newbie -- need guidance -- is this a good deal?

[Ashley Bee]

Hey all! Any investors in Michigan? I'm really good at finding good properties, but I'm terrified to actually make the deal! For example, I found a beautiful 3000 sq ft home in Troy, MI that has desperate sellers. My calculations (nerd) say the ARV could be over 100k. Is this house flippable because it's so big, or should I stick to the smaller homes? Thanks all!

Ashley

[Devin M.]

Ashely Bee

I have been in real estate for over 35 years and my husband and I have flipped 3 houses together.  (We generally lived in them while doing remodel)

One of the best thing to do in order to find out if it's a good home to buy is to do just a bit more homework on the neighborhood.  Are the other homes in the area about that size, larger or smaller? Is it a neighborhood that lots of people like to buy in? 

If it is considerably larger than all of the other houses, it may not be as good an investment.   The rule of thumb is to buy one of the smaller homes in need of updating in the neighborhood so that you don't overbuild.  But if the house you are looking at is similar in size to the others in the neighborhood, its a desirable neighborhood, and if you actually have the ability to make 100K profit, then it seems like a very good idea to jump on!  Be sure to count all the costs though, get costs on supplies needed, total closing costs and bids from licensed professionals who will have to do the plumbing, electrical and other services that you aren't able to do.  Always figure that the repairs will take twice as long to complete and that it may not sell right away depending on your market.  Hope it all works out for you!