Live in Flip - Looking for Advice

[William Sullivan]

Hi All,

I'm interested in purchasing a property in Tolland County, CT.  It's a 1070 sq.ft. 2-story home (photos attached).

All utilities are functional and city municipal: electric, water, sewer, and gas heat.

Here's my cost analysis / scope of work:  https://docs.google.com/spread...

Acquisition:  -$33k

Rehab:  -$44.8k

Closing:  -$1.4k

Holding:  -$4.4k

Sale:  -$10.5k

Total Cost:  -$94k

All-In Cash Cost:  -$83.6k (does not include sale costs deducted from proceeds)

ARV: $115k

Profit:  $21k

All-In Cash Cost / ARV: 72.3% (just above the 70% rule, but I'm also living here)

My first first goal is to find a new place to live.  I'd be moving in and doing most of the work myself (as broken down in the spreadsheet above).  I understand it's not a long-term, scalable strategy, and I'll essentially be making close to $20 / hr... but my hope is that the experience will be worth the opportunity cost.  I'm a software developer by day, and I'm looking forward to physical labor.

I'd prefer to target higher value deals with larger upside and lower cost / sq.ft. but the barrier to entry is pushing me back down. I've considered hard-money for a larger deal, but doing cash for the first deal feels more my pace. I've also considered 203k / FHA, but because I've been contracting less than 2 years, I need to wait until next year.

I'm planning to sell, but I was considering renting as a secondary exit strategy. At that point, I should qualify for conventional loan products. At $1.1k / mo rent, 50% of which go to expenses, I'm left with $550 / mo before PITI. Assuming a cash-out refinance at 70% LTV, I'll pull out $80.5k, which is most of my initial investment. Then, with a 3.5% 30-year note, I'm looking at $362 Monthly PI, $235 Monthly Tax, and $125 Monthly Insurance. This means I'd be operating at a loss of $172 / mo. So, I'm not planning to pursue this exit strategy.

Just looking for general opinions on this project proposal.

Thank You!