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House #5: Flipping Bank Owned Real Estate
My newest attempt to flip bank owned real estate is House #5. This newest rehab real estate project is located in an area I have been watching for a long time because it is in a good school district, has good highway and entertainment access and is an overall good area.
As I continue rehabbing houses for resale, I find myself getting better at estimating repairs, getting quotes for work and evaluating the potential of an investment. I am now in a very different position from where I was with my first flip.
If you are considering rehabbing a house but are unsure how to do it or what it takes just know that it is not as easy as they make it sound on TV but it’s not rocket science either. Educate yourself, do your homework but make sure you jump in at some point – don’t stay in the sidelines, especially in this market.
There are so many opportunities to invest and create wealth with bank owned real estate right now that if you don’t make a decision to learn it, do it and improve your financial condition you might not see an opportunity like this in your lifetime.
Back to House #5…
Probably what I like the most about this house is the subdivision it is in. All the houses around it are beautiful, very clean and well kept. This house is the smallest in the neighborhood which is kind of good since all the other homes will pull it up in value but bad in the sense that I will have to compete with bigger homes that are for sale.
I purchased this one as a HUD foreclosure for $67,000 (appraised in its current condition for $94,000) and plan on selling for around $115-120,000. I just had it appraised and the appraisal came in at $125,000 with repairs factored in. I think that is high but it’s good news.
Surprisingly this house is in great shape compared to previous rehab real estate projects. The major repairs are: new flooring throughout, replacing polybutylene plumbing, full interior paint, new appliances, redoing the entire master bathroom and the usual stuff like lightning, plumbing fixtures, landscaping and so on. But other than that, that’s it…pretty simple rehab.
I expect the rehab budget to be around $15,000 which is my lowest to date.
Here are the “before” pictures:
Rehab real estate can be tricky to evaluate. But this property has all the basics going for it. I will update soon how the rehab goes and then the resale.
UPDATE: House Flipping #5: The Final Pictures, Video and Cost of Rehab
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