While most markets are risky for purchase and resell, there are a few markets where this plan of action still works. We have reduced our resell operations by 75% until we start to see some markets for Single Family Homes begin to stabilize. The general process is to ensure we buy at 65% or less of the fair market value on the resale market. We then figure out our construction costs and figure that into our potential resale price. If we don’t see solid sales at or above 90% of the Fair Market Value in 90 days then we won’t touch it. Its better to walk away from a questionable deal than to gamble on a deal hoping we hit the jackpot.
Kitchens Often times need to be stripped down to the studs due to mold, disrepair or rerouting of the plumbing systems for better organization.
Most older style bathrooms are in need of repair or replacement of major components as well. These repairs often help resale value as well as buyers enjoy modern fixtures and layouts.
We then repair the house and bring it up to modern standards which fetches a very good resale price.
Exterior Landscaping is a must as well. Most families who buy a home rarely want to stay indoors so we make sure the landscaping creates a lush comfortable environment where they can entertain and enjoy guests.
In a typical Rehab, we may purchase for $100,000. The rehabs may cost $40,000 and resale price may be near $200,000 leaving a healthy profit for the team to split up. Once sold, the debt would be repaid or the profits split among the partners. Ask us about our 8 page report on “How to Make 10-14% on Your Money Without Stocks or Mutual Funds”.
