Case Study: 521 SE Richardson Place, Lees Summit

521-se-richardson-ranch

The Numbers:

Purchase for $191,219.00 on the day of purchase on the courthouse steps.

This home needed extensive landscaping, deck repairs, siding repairs, new roof, and interior paint and carpet.  Interior was quite livable, although dated.  We offered for sale as repaired for $125,000 and sold for $135,000 with us making siding repairs and replacing the roof for a grand total of $$11,554.37 in repairs.

Holding Costs that includes back taxes, insurance, utilities, and interest, came to $11,885.41.

Settlement Fees that include tax prorations, title company fees, and real estate commissions of $$7,054.92.

Profit made was $13.781.30

We held this house for 48days.

The story on this house:

This home was purchased on the courthouse steps for cash wired to the bank trustee attorney completing the sale by 5 pm the day of sale in the amount of 102,219.

Our evaluation:

We learned about this home the day before the sale and took a drive by.  In observing the exterior of the home, the yard and the exterior were in need of extensive repairs.  We were able to see in windows to find that the inside was not as bad as the outside.

We then turned to running the numbers of recent homes sold in the area and found home selling between $100,000 and $120,000 for bank owned homes that needed repair and homes that were renovated were selling for between $140,000 and $150,000.   The other plus was the home was vacant and we could start marketing the next day.

Repairs:

  • None made before marketing
  • Replace Shake Roof with Timberline per buyer contract.
  • Repairs to siding per buyer contract

Marketing:

We listed home for sale in the MLS and marketed heavily to local Realtors who work the area as well as the top 20 or so home selling web sites including CraigsList.  We listed at $125,000.

We had multiple showings in the first week end and multiple offers.  We accepted an offer of a little less than $135,000 that requested we replace the roof and we adjusted the price up to $135,000 when the appraisal needed siding repairs to facilitate the closing.

Total Time:  48 Days

Total Profit:  $13,781.30

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