Rehabs: Can you stil make money with them?
I got kind of depressed Sunday when I ran into a lady in the restroom at church who promplty told me you can’t anymore.
Her realtor husband used to do some rehabbing and had a good bird dog nose for finding the good deals.
It was rough to hear that. And I don’t think she was right. Why?
Here is a vid by Steve Cook of http://www flippinghomes.com
He takes you through a rehab step by step.
It’s a 3 bed, 2 bath, 1200 sq. ft. house in a fairly nice neighborhood.
This rehab was bought at $80,000. Rehab costs- $40,000 estimated
Steve thinks the house will bring in $200,000, possibly $210,000. Is that possible?
What do you think?
I think what is interesting here is he sticks to basics and he has a good contractor whom he can trust. That’s a good start.
My friend told me her husband believed you have to do all the work yourself to save money.
Again, I think that’s wrong. Not everyone can do this type of work, and by the time you figure it out, you’ve lost precious time, which is money.
However, some people are still skeptical, which is understandable in these times.
Again, I think you need to know your markets and you need to know what your expenses will be almost to the penny.
Here’s another thought. What about inflation?
I know, I know. What inflation?
I think there is a strong possibility inflation will return. I hope I’m wrong, but rehabbing is a good way to grab some houses now, at a reduced price, and hold on to them. Rent them out. Hold them against the declining value of the dollar. Real estate is still a good hard asset.