If you are interested in rehab as a real estate business, please contact me.  We offer turn key opportunity for investos who want to invest in Kansas City or in the Akron/Canton areas.    

Overview

The basic investment strategy is to purchase fixer-upper single family homes, rehab the properties to top condition, and quickly sell the homes for full market value.  Only houses that can be purchased at wholesale value will be considered for investment.  This ensures that the profits are secured at purchase and do not depend on an inflated market.

To have success with this strategy requires speed in the execution of the entire process, from speed in the acquisition of properties when an opportunity is found, speed from the contractors on the project, and speed in selling the properties on the market.  This will be accomplished through aggressive project management, selection of quality professional subcontractors, and marketing and selling the property.

Target Properties

The properties targeted for investment are single-family homes in need of significant repairs and located in decent neighborhoods.  Houses in marginal areas are not considered.  The attention is on houses in areas where first time homebuyers would want to live.

It should be noted that houses with major foundation or structural issues will not be considered for investment.

Determining Purchase Price

The purchase price will be determined by using a unique formula which will factor in the purchase cost of the property and the work to be done.  This is what secures the profits.  The beginning point in the formula is the ARV (After Repaired Value) and is determined using actual comparable sales in the neighborhood.  This is determined with a licensed real estate agent by using the MLS (Multiple Listing Service).  After the ARV is determined, subtract 30% and the rehab costs to determine the maximum purchase price.    This will leave a target profit of  20-25% depending on holding time.

Maximum Retail Value x 70% less rehab costs = Maximum Purchase Price

Estimating Repairs

Properties under consideration are inspected using a checklist developed for this purpose.  Items needing repairs or upgrades are identified.  Based on this information, a Rehab Cost Summary will be developed. 

Rehab Project

The rehab plan for each property will pay particular attention to curb appeal, the kitchen and the bathrooms.  These areas of the home are critical to the success of every project.  All rehab work is contracted to experienced professionals and is closely monitored.  The project will be professionally managed with experienced crews performing the scope of work.

Marketing & Sale of Completed Houses

The homes will be listed by a licensed real estate agent to allow for maximum market exposure.  The homes will be marketed using a professional marketing system.

Exit Strategy

Refinance the property after the improvements and cash out up to 90% LTV, then either rent the home using a property management company or sell it on a lease option for 1 year (which would also give you another 5% down payment in your pocket up front) the monthly payments would create a positive cash flow. 

SAMPLE

This house is a sample of one completed. 3100 Haskell, KC KS

Purchase Price         $12,000

ARV                            $75,000

Rehab Costs             $ 20,000        

Based on the formula the Maximum Purchase Price is $32,500

Target Profit is $35,000-40,000