I am looking at an off market propery that needs a lot of work, I had a contractor look at it and was hoping to BRRRR. They are asking for $285K.The numbers i ran are as follow. this numbers are a rough idea and I would put contingencies in the contract to mitigate any possible issues since it would my first time. Let me know what you think or if I'm just day dreaming. Thank you!
for the comps I looked at 3 properties that are very similar in size and distance. One of them is nearly identical and was sold last month for the price I am using for the ARV, The other 2, one sold for $490 and the other for $430.
$474,000 ARV - 20% for refinance
=$379,200 all in cost
$379,200 - $125,000 rough estimate for repairs including 15% contingency.
= $254,200 - $32,000 loan cost for 6 months interest only payments and origination fee.
= $222,200 - $20,000 closin cost for purchase and refinance.
that leaves me with a Max purchase price of $202,200
