Hello, BiggerPockets!
I'm 19 and currently a university student majoring in finance. I actively listen to every BP podcast I can listen to and about one third through "The Flipping Houses" book by J Scott. The reason why I want to get into flipping is mainly is to gain experience on how to deal with GC's and managing budgets on deals. So that way in the near future when I go into the commercial world of real estate, I will have some experience.
Enough about me back to the deal. So I was searching around for deals and saw the deal, and it was listed for 480k. I was interested looked at the pictures, and it looks like a real fixer-upper but not too bad but manageable with the right team. So I decided to call the wholesaler, and I was meet I no longer have the property. I was bummed out, but then I decided to search the address online and saw a realtor listed it for 600k. I forgot to mention that this property is foreclosed and looks vacant. So I started to do some number crunching, and I was thinking of using hard money loan to try and finance the deal but quickly found out as a college student making about 3-4k depending on sales on my e-commerce store that I was not going to be able to afford the monthly payments for just the interest alone. So I was wondering how I am going to find capital to finance the deal. So I went to a local real estate meeting asked the presenter who if he would be interested in such a contract and he said that he does not do flips that large. So tonight I went to another meeting, and this time it was new investors who have not done a deal. The presenter was a young man like myself, and he was a wholesaler, but he did not possess the capital to take on this type of deal. As I was driving home still looking for that investor, a light bulb went off in my head "where can I ask a community full of investors for capital or atleast point me in the direction of finding it." So here I'm writing this long post, and I hope I can find some help here. Some numbers for the deal and general location.
Location: South Palm Beach County and North Broward County Florida. The reason why I'm giving a general area is cause I don't want the deal to get sniped.
Status: Foreclosure listed by a realtor provided by the bank. So the lender is selling it.
Listing price: 609k before they were willing to wholesale it for 480k or something less than that as the wholesaler makes his cut from the transaction. I think we can negotiate it down with the lender knowing this, especially if it is a cash offer.
Bedrooms: 6
Bathrooms: 4
Square footage: 3952
with a garage.
Condition: Looks like it needs roof repairs and some new walls or repairs to walls. Possible mold. These are from photos I can see from the listing I have yet to visit it.
Year built: 1980-1985
Possible ARV: 820k. These are some rough calculation and do not take it to heart.
Comp property: 1
Condition: Unknown
Bedroom: 4
Bathroom: 3
Sold for: $815,000
Sold: within one month.
Square footage: 3,064
Price SQ: 265.99
Comp property: 2
This is the closest property in terms of rooms and size.
Condition: Unknown
Bedrooms: 6
Bathroom: 4
Sq: 4238
Price sold: $890,000
Price SQ: 210.55
Date of sale: Four months ago.
Comp property : 3
Date of sale: 2-3 months ago.
Condition: Clean (looks nice inside)
Bedroom: 5
Bathroom: 7.5
Square footage: 5,820
Price per square feet: $150
Calculation:
150+210.55+265.99=625.54/3=208.85
Now, these are very rough estimates.
Now did not account closing costs: which around 5%.
Also holding or opportunity costs associated.
Also, rehab costs: Now, I'm not familiar with calculating costs. I would say around 60-80k
Those are all the numbers I have right now. Please let me know if it is a good deal or not. I was going to try and negotiate around 500-550k on this property.
How I would like to position the deal equity wise is 10-20 percent equity, and I shadow you as you go along this process. You do not have to mentor me or anything of that sort; I will sit and watch and take notes and help with the project any way I can. That is if someone is interested in doing the deal with me or knows someone who would be interested.
Lastly, I do appreciate you reading this if you have. Also, any advice would greatly be appreciated. I'm not one to think about doing something I have a "just do it" mentality, and that is what I think it takes to be successful in these United States.
Edit: I would also be open to doing all the work and dealing with the rehab for a 50-50 split.
