Aug
6
Encouraging Day on the Real Estate Front
August 6, 2007 |
Met with our realtor today to check out the Main St. house, as well as to look at five or six potential properties for the next go around. Good news on the Main St. front, as he definitely want to list it in the $90s and doesn’t think that’s crazy at all. I threw out $92,500 as a guesstimate and thought we should shoot for $94K-$96K, just to see what happens. We’re not really pressed to sell it quickly so it does make sense to float something higher out there and see the response. I likely need to rein in my pessimistic, get-it-sold-quick-and-move-on nature int he future as far as listing prices, as I contine to land a bit on the low side so far.
We looked at two pretty attractive properties, whichboth have the gears turning in my head. I was actually leaning more towards a rental but both of these would be flips, one much quicker than the other. The fast one appears to be a bit of a no-brainer, but not very exciting or challenging. It’s a HUD listing, a 1300 sq. ft. 3-2 on a little over 3 acres that was built in 2003. It’s a bit outside of town but not too far, and has been on the market for nearly 60 days at $99,500. It needs new flooring and paint but it’s in really good shape otherwise.
It’s a bit odd as the previous owners did absolutely nothing as far as landscaping, so it’s just sitting there sort of forlornly. There’s also a workshop/guest house in the back that’s framed up, insulated, and wired, but was never finished out. It’s got a fairly steep driveway that’s pretty badly washed out and would need to be re-graded and graveled, which I imagine scares some prospective buyers away.
It’d be a piece of cake to renovate, and would be done in 3-4 weeks. Paint, tile, upgrade the fixtures, throw some appliances in there, finish out the guest room,do some basic landscaping, and I could pretty easily list it at $125,000-$135,000 (which is what it currently appraises at). Apparently you can sometimes get pretty steep discounts on HUD homes that have been sitting on the market for awhil, so if I could get it for $85,000 or so, it’d be a pretty nice deal, and likely a relatively painless flip.
The other house is much more of a project. It’s a 1900 sq. ft. 3-1 built in the 1950s, on a big .3 acre corner lot in a nice neighborhood in town. It’s got a bad current case of oldfolkitis, as nothing has been updated since the early 70s. It’s also got the ugliest asbestos siding I’ve ever seen (some weird mottled shade of charcoal gray), and the furnace needs replacing, as well as the roof.
On the bright side, it’s got original hardwood floors throughout much of it that are in great shape, and the current awkward layout of many of the rooms could be pretty easily consolidated into a pretty amazing space. Kind of hard to describe but it’s one of those layouts with a central kitchen area that’s currently blocked off into many small, awkward spaces (none of which have a clean line of sight into another room), that could easily be fixed by knocking out walls here and there. There are currently two dens/family rooms, one that’s pretty large, and it’d be fairly easy to turn the larger one into a master suite, with an addition on the back that’d suddenly give you a 2400 sq. ft. 4-2.
But the kitchen and existing bath would pretty much have to be gutted, as well as new siding/furnace/roof. It’s listed at $89,900, but its been on the market for awhile and the sellers are apparently getting antsy and about to sink some money into updates, so I might be able to get it for $75,000-$80,000. Assuming I put $40K into it (which is well within the realm of possibility), it could be a profitable flip, as it’d likely sell for around $175K with all of the additions and upgrades listed above.
The smart, sensible thing would be to go after the HUD home, as there’s really no wild cards there or anything outside of my skill set. Pretty cut and dried, very little risk. The older house would present all sorts of new difficulties and experiences, as I’d have to hire a contractor for much of the work, and get used to the idea of forking over fairly large sums of money, something I’ve avoided up to this point. For whatever reason, I’m actually kind of leaning towards the challenge right now of the older 3-1, despite all of the reasons to take it easy and catch my breath a bit. We shall see.
Comments
1 Comment so far
My only thought would be, which one has a better market for sale right now (or are they about the same)? With a $50K difference in potential asking price, the number of potential buyers in the two brackets can differ tremendously depending on your part of the country. Just a thought.
Otherwise, congrats on finishing up the Main St. property. For the next property the legion of dedicated readers only as for one thing: photos! :o)