Evaluating a property

[Darren Nichols]

Here are the figures of a property I am wanting to wholesale:

ARV: $130k * 70%= $91k- $15k in repairs= $76k- $5k wholesale fee= $71k

Now the 15k in repairs is speculation because I am going to see the property on friday but the seller said it does need some work(its about 1830 sq ft). The problem I am running into is that the seller still owes 61k on the property. The seller stated they would like to get 20k in their pockets if possible. The way I look at it I don't think that is possible and even if I wholesaled it for free they would only make $15k on it. I am just seeing if I am missing something, or if anyone thinks this isn't a good deal to wholesale or if I just need to negotiate with the seller to only getting $10k in their pockets from the property. I also understand that repairs could be more or less and if the repairs are more than 15k I think it would be tough to make this deal happen. Any insight is greatly appreciated!

Thanks

[Scott E.]

Darren

I don't see enough room here for the seller, for you, or for your end buyer. Even if you talk them down to being OK with only $10k in profit, $15k sounds VERY low for rehab costs on a house that size, unless it is already nearly move in ready. You should expect closer to $40k on a home this size if it needs the cosmetic basics (floor, cabinets, counters, paint, baseboards, hardware, etc)