I found a potential property today at buyazforeclosures.com and went over to check it out at lunch. This property caught my eye because they were selling it for about $30,000 under FMV.
This property would be a good rental, but I don't think it would work for a flip. As is standard with foreclosures, there was a fair amount of trash and holes in the walls present. The kitchen needs new appliances and new cabinets. In fact, all the cabinets in the house need to be replaced. The bathrooms weren't too bad, but they would at least need new sinks and vanities. The furnace was missing. Of course, carpet and paint would be needed. The backyard also had a fair amount of trash that would need to be hauled away - a couch, some dressers, tires, etc. The house was also built in the early 1970s, so there could be aluminum wiring issues. All in all, I think there are enough things that need to be done that I would need to hire a contractor to coordinate and supervise the repairs instead of just using a handyman.
It's too bad really. I like the neighborhood. It's an older neighborhood, but the houses and yards are well kept. The house across the street is being remodeled and will have a really classy front facade. I figure you probably could still make about $5,000 on a flip, but that's not enough profit to take on such a large project, especially when you take into account possible cost overruns and any repairs my cursory examination might have missed, not to mention the cooling of the local real estate market. But, as I said before, I think it would make a good rental.
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