Repair Costs Shall Not Exceed% Of Purchase Price
Hi I have read in a P&S a statement that says "Repair Costs Shall exceed 10% of Purchase Price, Buyer may, at his option, elect to terminate contract " Steve Cooks uses 10% and Legrand uses 25%...as I understand this...if you have the ARV at $100k and the repairs are estimated at $20K and my MAO is $50K and my Purchase Price is $48,000...I add lets say 10% to the Purchase Price which is $4,800 and add that to the estimated repair cost which will be a total of $24,800...is this what this means? This is an exit door out of a contract due to under estimating the true cost of repair??? What percentage is more realistic?
I appreciate your help.
[ Edited by Flipster on Date 05/06/2006 ]
[ Edited by Flipster on Date 05/06/2006 ]
It depends on the area - some folks are more worried about the potential problem than others, but I think most are worried about their property value - which was your concern. Talk to local realtors and see what people are saying these days in your area.
Our experience is that the nearby location of the actual power substation does substantially lower buyer interest. Power lines themselves not so much but still somewhat limiting.
Jim
I agree with panic, that is the step a lot of people miss out on and that is constantly looking to expand your investor base, when I get a property it goes out to about 4500 investors I haev either met personally or have responded to ads I run
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