If your ARV & repair estimates are accurate (no help on estimating repairs), then I think your deal needs to be more in the 110-120k range, unless you plan on putting up the money for the purchase. This would give you the chance to pass it on to an investor, and still give them room to make money after repairs, holding costs, etc. You may find an investor out there that would pay more. There’s a big gap between 225-250k ARV. Everyone has there own formula for buying.
If the numbers do work out, you should put it under contract, and assign the contract to the investor (question #3). That’s how you make sure that you don’t get lost in the shuffle. Get your money & get out when they buy.
Ok,
Since my first message got removed, I’ll repost it in the form of a question. I’ve found a house selling for approximately $150K that needs some rehab work. Without going into details, it looks like around $25k needed to make the house pretty great or $50K (max) to make it amazing. Comparable houses in the area are selling for $225-250K. I’m looking to find an investor willing to pay a finders fee for this, any suggestions how to find one?
The options facing me are as follows:
Buy the house, do the rehab, and resell for profit. I just bought another house so I’d need a partner (already talking to my father about partnering with him on this deal, but not sure we can do it). Any suggestions on how to determine a more specific amount needed for the rehab would be appreciated.
Get the house under contract and flip the contract. This seems more likely, I’m talking to the seller on Wednesday and seeing the house tonight, so I’ll have about two days to figure out how this one would work. I haven’t done something like this before and want to make sure I don’t get locked into anything so please let me know if any of you have made a deal like this before.
Talk to an investor and give him/her the information, Investor buys the place to rehab for a profit and give’s a finders fee. How do I make sure an investor doesn’t get around me once I give the information. Suggestions?
This is the first absolutely clear deal I’ve found and of course it happens less than 12 months after I buy my first home, so I’m kind of strapped on cash right now. Please email me with suggestion on how to make this find profitable.