Help Newbie Here
Hud Repo listed
3bd 1 bath listed @ 49500
50900 value by county last asses and last sale was 58000 in 98.
I won the bid for 37500. I figure with complete rehab 5000 with brand new everything kitchen, carpet, and paint. for a total of 42500.. my payments equal less than 200 per month with 100 per month tax and insurance for a total around 300 to 325 . I want to lease option for $75,000 with $5000 down...$ 725 per month PITI for 24 months.....5000 credit if every payment is on time my question is should I include my 5000 up front towards the buy price or should that be a non refundable option payment...I guess I am confused how to price right now on my first deal......help!!!!
It sounds like you got a great deal. Congratulations!
You set up sounds good to me. The only comment I have is hwere / how did you come up with the asking price of $750/mo, and sales price of $75,000???
If there are comparables (comps) in the area that can substantiate that price, and if that is the local rental price for a home of that size, then you are set. If you have not look at comps or the local rent rates, then do so before setting your prices out in front of the public.
Hey, don't forget you can list homes here at TCI Realty, too.
Good Luck!
You've got a lot of things going on here, Brill that you'll need to get a handle on quick.
First, like 64 said, you need to know what to price and rent the property for, guessing is not the best strategy. Find out if those figures are good for your area or not.
Second, in my experience, asking for $5K down on a L/O is a bit high (especially in this economy). However, it may not be in your area, but again, this is something that you need to know. Also, with a L/O, there is no PITI to your tenant/buyer, just a monthly rent amount.
The option deposit is almost always deducted from the purchase price, especially that amount. It still is non-refundable if they fail, or choose not, to exercise their option to purchase.
Third, are you sure of your costs to rehab? Most kitchen replacements would run around $5K. Most painting and carpeting, you can figure about a $1 a sq ft for each. So if it's a 1000sqft house, you'd allow $1K for painting, and $1K for carpeting. These are quidelines for my area, your's may be different. And yes, you can do it yourself and save, but you still need to allow for the cost of having someone else doing it (hey, I pay me for my time anyway).
Just some thoughts,
Roger
Thanks for the replies. I beleive you maybe right Roger that 5000 is a bit high I was just hoping to defray my down payment and have some extra in escrow in case I need it for mortgage payments. Rents average 750-775 for a 3-1 for this area and the price I figured for the remadel of the kitchen was just new countertops and cabinet refacing with some new appliances and vinyl floor. I can do paint and carpet in the rest of the house. I guess I should for my own sake estimate a bit high on my costs..