Tuesday March 27
The end of the month is drawing near. I am wondering if Spring will ever get here. It is far too cold! I try to use this time wisely as an investor. Once the warm weather arrives usually all bets are off.
Jonathan, Angela and I went to scout out a potential rehab property yesterday. Jonathan located it and wanted to take a look. The property has a lot of potential. The problem is the asking price is way too high. Jonathan was surprised at how much work it really needed because the pictures looked pretty good.
Here is our list for starters.The septic hasn’t been tested so we have to assume a fail. The roof must have been leaking as they had put a tarp over it. The tarp is gone now but the remnants from that set up are still there. So the roof has not been replaced. The house either needs siding or a paint job. Neither of which are cheap. The addition that is underway is a complete tear down as it is not built to any code that I know of. The deck was not built on solid footings and needs to be torn down and rebuilt. The copper has been stripped from the house as well as the wiring. Therefore you need a full house rewiring and a complete new plumbing set up. Once you address all these things you can start to look at the cosmetic issues that need to be addressed. They are pretty standard. The kitchen, bathroom, flooring walls etc. The best thing about the house is its windows!
The question becomes, what would you do? Jonathan was pretty bummed out. So I said not to worry. We’ll make an offer anyway. The worst thing that will happen is they will say no and we spent a little time putting together an offer. And that is good practice anyway.
If they were to negotiate on price then it would be a great project for him. There is quite a lot of work he could set out to do as it will really help him learn faster. I am not hopeful that they will accept an offer. Their asking price is not even in the ballpark. The house is going to sit for a very long time at that price. I am not sure who gets to sit behind the computer and set the price on this one, but he really should be fired! It will never sell close to the asking price. You have to know your market, and it is clear that he or she certainly does not! I see this so often. I always ask myself what are they thinking? I would sure like to know in what world their numbers work.
This is what they are thinking lol.