Look for Properties with the Right Things Wrong

By
Real Estate Broker/Owner with M & M Realty of Brevard Inc. BK629999
https://activerain.com/droplet/4FVm

Look for Properties with the Right Things WrongI had an appointment to meet an investor at a bank owned property that had just come on the market.  As I waited for my buyer to arrive, there was a parade of potential buyers and Realtors looking through the house. I suppose the enticement was the very low advertised price. The house was a bank owned property and it needed considerable work. There was a poorly constructed addition at the back of the house and there was rotten wood all the way around. The outside stucco was unprofessionally done and was riddled with stair step cracks. One corner of the house was sagging. When we got inside we saw that the house needed to be gutted. The roof was leaking in various places and the ceilings were sagging.  There was no kitchen or bathroom and no flooring. It needed a new electric panel and appeared to need new wiring.  The inside and outside a/c units were missing. It was apparent that there were more issues than met the eye in this dilapidated old house. We agreed that it looked like a Pandora’s Box of problems. 

In buying investment property consider a house with the right things wrong with it. The wrong house at the wrong price can be a buyer’s nightmare.  An investor putting his hard earned dollars and his sweat equity into a property should be able to build in some equity of his own. In real estate you make your money when you buy. In figuring purchase price, renovation costs, plus an additional cushion for unforeseen problems and the unprofessional workmanship throughout this particular house, it was a loss. The true value was in the land. In researching further we found no surrounding properties in the neighborhood or on the street to add value on this house after the cost of a renovation. And, the fact remained that when completed, the house would still only be a 2 bedroom, 1 bath.

Some investors may be enticed by a property with a price that seems too good to be true, but leave it for someone else. A bad investment can waste time and drain a pocket book of hard earned money. Look for properties with the right things wrong.

 

 

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Tags:
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bank owned properties brevard
properties with the right things wrong

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Rainmaker
1,509,895
Gary L. Waters Broker Associate, Bucci Realty
Bucci Realty, Inc. - Melbourne, FL
Fifteen Years Experience in Brevard County

Excellent post. I love your title on this one!  It is not about buying the perfect house but rather the one with the right things wrong!  I may borrow your focus and turn something into another post but give you the credit for the inspiration, of course!

Jul 08, 2015 12:52 AM #1
Rainmaker
671,701
Sandy Shores FL Realtor®, Melbourne Real Estate
M & M Realty of Brevard Inc. - Melbourne, FL
Brevard County Real Estate, Florida's Space Coast

Thanks Gary L. Waters, Broker Owner Waters Realty of Brevard, LLC so true. Is there such a thing a perfect house? I don't think so. So glad I inspired you this morning, my friend.

Jul 08, 2015 12:57 AM #2
Rainmaker
3,246,975
Lou Ludwig
Ludwig & Associates - Boca Raton, FL
Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC

Sandy

I agree with Gary L. Waters comments . . . . Also it's to customers best interest to use the services of a real estate professional.

Good luck and success.

Lou Ludwig

Jul 08, 2015 02:07 PM #3
Rainmaker
4,796,627
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Hi Sandy.   For investments, it's all in the numbers.  How much will it cost to make this home workable?

Jul 08, 2015 09:37 PM #4
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Rainmaker
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Sandy Shores FL Realtor®, Melbourne Real Estate

Brevard County Real Estate, Florida's Space Coast
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