How to buy and negotiate real estate | Flipping houses | In The Life 120

– [Man] That sounds good. – Okay, so no, we’re looking at a couple places today, we’re gonna get some.

– [Man] That sounds good. – Okay, so no, we’re looking
at a couple places today, we’re gonna get some good footage. I think this place is vacant,
but let’s take a look, c’mon. (upbeat music plays) (calm music plays) – Write anything down
anymore. My memory’s shot. – Alright. – Photos is the easiest
thing to remember. So yeah. We’ll be fast too. I’m looking-
I see just from the exterior the roof needs to be
done, some concrete work.. – Yep. – Garage door, and let’s
see what the inside brings. Now this is your uncle’s
house, right, you said? – Grandmother. – Your grandmother. – Yep. – And you’re the one kinda helping her? – Right. – Alright. – Myself and one of my uncles. – Right. Are you kind of a decision maker? – Yeah, yeah. – Okay. – Me and my other uncle. – What’s your take on
this whole scene here? – As far as what? – Just kinda like, what your goal is, you know, like “let’s sell
this sooner than later”, you don’t wanna do any work to it, right? – No. I mean, we were going to, but then once that pipe
that burst in the kitchen. – That kinda put you over the edge? – Yeah. – Where you’re like, “to
hell with it”, right? – I don’t know… (unintelligible) – When was the last time
someone was in here? – I was here Friday. – Okay. And the water is off right? – Yeah, it’s off. – Okay. Alright. – And by the way,
whatever you wanna leave, go ahead and leave, that’s kinda how I, that’s a service I have too. – Okay. – Like, take what you
want, leave what you want. Are there things you
wanna leave behind, or? – Yeah. There’s some stuff that I still
have to come clean out yet. – Okay. – A lot of stuff, I’m guessing, but… – Alright. The windows are
original too, I saw kinda, right? – Yeah, They are. – I see the electrical
needs to be upgraded. Okay. So where, is this where things happened? – Yup, yup, it was in here. – So a pipe burst under this floor? – Right. And so that’s
why all this was wet. This is all buckling. – Okay. Interesting. Alright. Did you have anyone look
at it? I’m just curious. Like a plumber or anything,
or you didn’t even bother? You just kinda shut the joint down? – Well, Davis, they came
out last week to look at it. We haven’t gotten that
estimate back from them yet. – What did they say? You wanted a quote on
the restoration work? – Yeah, yeah. – In case you wanted
to do it yourself? Or? – Just so we can know some
kind of ballpark figure. – Okay. You can see this. This is
from the floor buckling. – Correct, yeah. And this is not the hard wood that flows through the house obviously. – No this is something
different they put in. – Got it. And this is like
a little breezeway, here? – Mm-hmm. – How soon do you wanna sell? What’s ideal for you, by
the way? Rough timeline. I forgot what you told me over the phone. – The next 30 days. – Got it. Yep. Okay. – Oh, it’s a grill! – Oh! – Yeah. – That, like, permanently? – Yeah, it’s in there. – Oh. Okay. Interesting.
Alright, so here’s a half bath. So one bedroom, okay. Is there any power? – There is. Let me turn it on. – Okay, there we go. Second bedroom. Now, was there some kind
of leak situation here? – Some water damage in there. I think coming from underneath the sink. – And that’s from again the
no heat, freezing scenario? – I think so, yeah. – Okay. – But, I don’t know if the pipe burst. This one I think is older. – But there’s probably some
extensive plumbing issues happening here in general I would think. – Seems like it. Definitely. – Okay, alright. Let’s see
what’s going on downstairs. – Okay. So the leak happened under here. So its like this pipe that runs along like that one right there, pretty sure that’s the
one that was leaking. – Okay, I mean the bottom
line is this whole rec room has to be demoed. This has to be stripped down
to raw basement. Bottom Line. – Yeah, pretty much, cause you can see the mold
starting to grow in that corner. – There’s no question. – And, he’s got the buckets here. – And you don’t want the city in here. – Oh, yeah, I know. – They’ll destroy you guys, with that, so, you wouldn’t want that. How has the basement been otherwise? – It’s been good before we had that leak. – Did it stay dry? Meaning like the perimeter didn’t seep in? That kind of stuff? – No. – Okay. Yeah, the key with
this basement, strip it down. That’s the healthiest solution here. And its unfortunate because this actually is
a potential scenario here, but it’s gone. Alright, you wanna go upstairs
and talk for a few minutes? And, then I’ll be on my way. – Okay. – How long has your grandma
owned it for roughly? – Since the 70s I want to say. – Okay. Well, yeah, and that
stuff has to be factored in, you know if it’s a growing
area that helps value, if it’s a depressing area, it’s only going to get value-wise worse. So, what do you think price-wise
would make sense here? Knowing the condition it’s
in, you know the basement, the restoration, the mold remediation which has to be down
professionally by the way. You’re talking big money
going into this joint. – True. – That’s not even talking about the roof, and the remodeling. Before we remodel this house
I’m doing major restoration, mold remediation, demoing
the basement, and the roof. That’s tens of thousands of dollars – Mm-hmm – Before I even begin to paint or refinish the hardwood, etc. Do you follow, just, I want
you to know where I’m at so you don’t think, so you
understand where I’m coming from. – Okay. – Does that make sense to you? – It does, yeah. – Oppose me if you will. Please! – No we’re pretty much well away of that. – So, my point is we talk
about 15 restoration, lets just say 13 for the roof, okay? – Yea – That’s 28, mold remediation, well that’s kind of in
their with Paul Davis. Did they do that too? – Yeah, yeah they did. – Okay, so I’m at 28
before I start remodeling, and demoing the basement,
refinishing the floors, painting updating the bathrooms and the kitchens, redoing all the plumbing. Do you see how 60-70 into this
home starts to be real math? – Yeah. – I just, again, I don’t want
you to take my word for it. I’ve been doing this a long time. And then the windows,
like stop me if I’m, like, – Oh, this is stuff that we… – The concrete! So my point is that I’m not trying to beat up the house. I just want you to know
where I’m coming from when I come up with value. – Mm-hmm. – Cause value is very
objective in real estate, meaning it’s not my opinion. So, how much do you
think the house is worth when it’s done? In your opinion, like fixed
up, remodeled, kind of… – Oh, when everything is all finished? – Yeah. Yeah. I’m sure you
guys have looked into it. – In this neighborhood, I
don’t know, 90 thousand, maybe. – Maybe a little more. Okay, I’ll give you the
benefit of the doubt. I’m gonna think when I’m done with it, I probably can get 105. – Okay, yeah, that’s pretty close to
what I was thinking, 106? – Yeah, exactly, I think
I can get more than 90. See I’m honest, a lot of guys would be like,
yeah, 90, there you go. I can get about 105 for it, seriously. So you take 105 and this is just raw math. I got to pay a real estate
commission when I sell it. Okay, everyone does. That’s how it works. Whoops, 105 times point nine four brings me down to 98, seven. On the greatest day of my life, I’m putting 65, lets say, into it, could be more, but I’m gonna say 65. You kinda see where the
math is gonna go already? – Mm-hmm. – Like this number breaks me even. – Okay – In the world of like what we’re just generally talking about. It’s just math. That’s all that is. So, what are you expecting? – We have no idea.
That’s why, I mean, like, – Yeah – I don’t know. I’m not so much into the selling. – Okay. – I’m mainly like renter, so as far as renting out
things. I have no idea. – Yeah. – That’s probably about
what we’re guessing. – And, any buyers gonna
do that math though. Because, renting or selling,
the value’s the value, and this stuff has to go into it. – True. – The roof is done, like
the shingles are curling. I mean you see that, right? – Oh, yeah, it’s a very old,
and the furnace is also old, so that probably has to come
out as well at some point too. – So, I’m putting 65K into this; correct me if I’m wrong, but I’m not. It’s like you see that. I see it. So, like, paying somewhere in the 30s is like a break even point. There’s not a lot of
money to be made here, because it’s only worth
105 in the end, anyway. If this house was worth
180 when it’s done, we can have a very different conversation. So, there’s not a lot of value here, so, what are you willing
to accept for this house as-is, cash, knowing I got to squeak a
few bucks out of this thing, and I wanna make you guy’s
as whole as possible. So, uh, I’m up in the air. Do I buy this? Clean it up, fix it on the
minimal basis and rent it, cause here’s the thing, when you’re buying something for rental, what you do is, you kind
fix it up minimally. Make it clean and fresh like
enough for someone to rent it. (calm music)

Leave a Reply

Your email address will not be published. Required fields are marked *