The Numbers:
Purchase for $192,613.63 on the day of purchase on the courthouse steps.
This home needed virtually no repairs. Previous owner took the appliances and kitchen sink. We replaced these items and shampooed carpets for a grand total of $8,313.26 in repairs.
Holding Costs that includes taxes, insurance, utilities, and interest plus a fee paid to the previous homeowner to move out came to $5,624.27.
Settlement Fees that include tax prorations, title company fees, and real estate commissions of $13,500.09
Profit made was $39,091.75
We held this house for 62days.
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 $192,613.63.
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 clean and well manicured. We were able to speak to the owner being foreclosed on and they had plans to move out with in 30 days and allowed us inside to view the home where we discovered the home was in excellent condition.
We then turned to running the numbers of recent homes sold in the area and found homes selling between $270,000 and $300,000. The previous owner also told us that he had had it listed for a few days at $275,000 with people looking at it, but he had canceled the listing.
After we purchased on June 30th, the previous owner agreed to move out by July 31st.
Repairs:
- Remove sink for previous owner & install new one
- Replace kitchen appliances w/ stainless
- Shampoo the carpets
- Minor Inspection Repairs
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 $274,900
We had multiple showings in the first week and had an offer of $260,000 in 6 days. We accepted this offer with no negotiations and took the home to closing in about 30 days.
Total Time: 62 Days
Total Profit: $39,091.75
This is not a typical transaction.