I have come across some difficult deals here in Columbus as of late. As the market is changing and becoming more of a seller's market as would be expected prices are rising. As well as to be expected some homeowners are selling at prices that even they know is too high. The funny or amazing thing is that they are selling at or at near retail prices!
Then there are those properties that are at a very decent price and may not be in the absolute best of areas but would still be good flips if completed and you one can find an actual buyer willing to live and invest in the area or would be great rental properties that would pull in good cash flow.
I currently have one like the latter. It's a 9 unit building in an area just outside of the "hood" or an undesirable area. Even though it's in one of the better parts of the area, simply that it's so close I suppose that most feel that it's too much within walking distance. So no one has wanted to touch it.
It's a 9 unit 2 bed 1 bath building. The owner wants to walk away with $150,000. There is $25,000 in back taxes. There is about $50-60,000 in rehab. I'm looking to make $15,000 on the deal and the ARV for the building is $350-500,000 ($300-$450,000 being conservative). So we are looking at $165,000 purchase ($150,000 the sellers want + $15,000 for my fee), $25,000 in back taxes, and $50,000 in repairs all equals $240,000 with the final value being $300-$350,000 minimum. The new owner could very easily get $600 per month per apartment once the rehab is completed. $5,400 per month, $64,800 per year!
And yet I can get no one to touch it! And I can't figure out why! Maybe someone can help me.
