$182.79 to buy a 130k property with an ARV up to 280k!

     I really did not plan on blogging about this property until after the sale of this property. However, I was too excited and was hoping to motivate people who are still on the fence on whether investing in real estate is worth the effort. 

    Since my last flip, I have quit my day job, became a Realtor, and established my own real estate brokerage. It has been a roller coaster up to this point to finally land what seems to be a home run. 

     I have been marketing with direct mail, SEO, and social media. I have gotten a bunch of hits, but I was not able to secure anything. I obtained this deal from the Realtor who sold my last house. What I recommend here is to continue marketing, but have constant contact with the people that have helped you in the past. Even if it is just a text, let them know that you are always looking.

  The house was inherited by the owner and he was using it as his office. He did not want to go through the "head ache" of rehabbing the home himself. I made an offer of 130k with him to carry the note on the terms of a 1 year balloon 2% interest. He did not require anything down as he was only concerned on getting 130k in his pocket.

  I received the final HUD statement and I actually thought that my closing costs were going to be about $2500. To my surprise, the title agent told me that I had brought too much as I had mis read the statement. I was to get a credit for 2285.25 instead of coming out of pocket the 2468.04. The reason it was so little had to do with the taxes and HOA proration. I will pay for the amount when I go to sell, but the fact that I only came out of pocket $182.79 shows you that it does not take much to get into the business when you find the right deal!

   Here are the basic numbers for the rehab.

Purchase - 130k

Rehab - 45k

Foundation - 10k

Holding - 5k

Should sell (based on sold comps) - 265k - 280k 

   Our goal with this property is to have it sold before we finish rehab. The area this property is located based on comps are selling between 7 to 30 days from day of list. 

   I will update with pictures of the before and after on my next post. I want to say thank you again to the Realtor that helped be get this property. If you have a Realtor you have worked with in the past or now, make sure you let them  know how much you appreciate them. They just may bring you your next deal.

-Justin