This property was already on the market for 40 days before I spotted it.
Having access to the local MLS and knowing what to look for, I quickly realized that this house was distressed with no potential retail buyers due to the condition.
I walked the property to assess the problem and the potential at the same time. When I arrived, garbage was dumped in front of the house with no dumpster.
I went inside and spent 2 hours inspecting the house only to find more problems (which was a good thing)!
- No electricity
- 2 feet of standing water in the basement
- Entire basement covered with mold
- All mechanicals under water
- Missing kitchen cabinets
- No appliances
- Damaged windows, doors, and floors
- Plumbing pipes burst
Using my tools, I ran the numbers and I knew that the bank listed the house far too high for a potential investor to jump on it.
And due to the extensive damage turn key home buyers would not be interested.
At that point I knew that the bank wanted to sell it. Investors would likely low ball it and try to pick it up at around $240K.
However, seeing that it was only on the market for 40 days, the bank wasn't ready to just give it away.
I came up with simple strategy to position myself between the potential investor and what the bank was asking. I realized in order to get the financing to close the deal, it was going to take some extra work on my part.
So I jumped in and pumped out the water from the basement, partially cleaned up the mold and did a little paint touch up so it wouldn't be considered an environmental hazard.
Then, I added some much needed curb appeal with cleaning and painting to make it look like a house again and YES, I did all this work without the banks knowledge - but this separated me from the others in order to get the deal.
What can you take away from this case study:
- Always be prepared to go extra mile
- Check all properties that are on the market more then 30-45 days
- Stage the house, so buyers can imagine themself in the house
