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SVTPerformance's Chain of Restaurants
Road Side Pub
Can't decide what business to start. Please offer knowlege if you know about....
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<blockquote data-quote="FordSVTFan" data-source="post: 3415026" data-attributes="member: 2243"><p>If you really want to bust it out, lets do it completely.</p><p></p><p>First off where do you find this miracle property that is going to be worth $100K with only $15K in materials, labor and landscaping? So that means you are buying an $85K property for $35K. $50K undervalued :whine: Not happening. </p><p></p><p>If it did, you would have to qualify for either an unowner occupied mortgage or a personal loan. I have been involved in Real Estate for numerous years and never heard of a !!!</p><p></p><p>You would be required to pay origination fees, appraisal fees, application fees, title fees, title insurance and other closing costs. Easily $4000.</p><p></p><p>Then you have carrying costs, each month you are in possession. This will be higher than an owner occupied house. So figure you are out of pocket $500 a month on that. So $3000 over 6 months.</p><p></p><p>You will need insurance will it is in your possession although unoccupied, so add another $300 for 4-6 months.</p><p></p><p>Since it is an eyesore and needs work, you will also need permits and inspections. As well as the costs for that.</p><p></p><p>Then you will have closing costs and sales costs. You will lose $6K to real estate commissions. Then closing costs of about $2500.</p><p></p><p>Figure about $11K in expenses without any cost over runs or unexpected expenses with the rehab (quite likely with a cheap eyesore property).</p><p></p><p>Now you have conservatively $61K into your investment. If you can sell it for $100K, you have a profit of $39K minus short term capital gains of $12,500. Leaving an actual profit of $26,500.</p><p></p><p>That is assuming you can find this miracle property that is so undervalued and will only require $15K to make into a property worth 3X what you paid for it. </p><p></p><p>Then you just need to repeat this good fortune a few times a year without any changes in the market.</p><p></p><p>wicked easy :rockon:</p></blockquote><p></p>
[QUOTE="FordSVTFan, post: 3415026, member: 2243"] If you really want to bust it out, lets do it completely. First off where do you find this miracle property that is going to be worth $100K with only $15K in materials, labor and landscaping? So that means you are buying an $85K property for $35K. $50K undervalued :whine: Not happening. If it did, you would have to qualify for either an unowner occupied mortgage or a personal loan. I have been involved in Real Estate for numerous years and never heard of a !!! You would be required to pay origination fees, appraisal fees, application fees, title fees, title insurance and other closing costs. Easily $4000. Then you have carrying costs, each month you are in possession. This will be higher than an owner occupied house. So figure you are out of pocket $500 a month on that. So $3000 over 6 months. You will need insurance will it is in your possession although unoccupied, so add another $300 for 4-6 months. Since it is an eyesore and needs work, you will also need permits and inspections. As well as the costs for that. Then you will have closing costs and sales costs. You will lose $6K to real estate commissions. Then closing costs of about $2500. Figure about $11K in expenses without any cost over runs or unexpected expenses with the rehab (quite likely with a cheap eyesore property). Now you have conservatively $61K into your investment. If you can sell it for $100K, you have a profit of $39K minus short term capital gains of $12,500. Leaving an actual profit of $26,500. That is assuming you can find this miracle property that is so undervalued and will only require $15K to make into a property worth 3X what you paid for it. Then you just need to repeat this good fortune a few times a year without any changes in the market. wicked easy :rockon: [/QUOTE]
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SVTPerformance's Chain of Restaurants
Road Side Pub
Can't decide what business to start. Please offer knowlege if you know about....
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