Atlanta REI

Thursday, June 01, 2006

House #3 Under Contract

It has been awhile since my last post. I have taken some time off since the birth of my son. I'm glad to report he and mom are doing just fine.

Now on to real estate.

The house that I looked at in the neighborhood near my in-laws (Hampton), is now under contract. Like the Duluth house it is a short-sale. The lady who owns it has already moved out and it will eventually head into foreclosure. Although it is not that far along yet. I am not sure how far behind she is, but my miracle agent says she thinks the bank (Countrywide) will accept our offer of $70,000. It is a four side brick three-bedroom two-bath house with a covered carport built in 1965. It needs landscaping, soffit repair, new roof and a leak needs to be fixed in the master bath. It has hardwood floors underneath carpet, so we will just pull the carpet out and refinish the wood floors. The kitchen cabinets can be resurfaced and we will replace the countertops. Short-sales move pretty slow, so I don't expect closing on this deal until sometime in July.

I have yet to come to a final decision on the exit strategy. I expect the ARV of the house to be somewhere around $100,000. Everyone knows I am a big buy and hold guy, but I think I may just want to sell this one or do a lease purchase. My big reason for not wanting to hold on to the property longterm is because I don't think this sub-market will be moving in the right direction in the next two to three years. Therefore, it will become more management intensive as the quality of tenant goes down and my appreciation will slow, too. However, I am a big buy and hold guy. LOL.

2 Comments:

  • Congratulations on the birth of your son! I definately know how much caring/nurturing a newborn chips away at your free time, but it's well worth it, IMHO.

    Sounds like you haven't skipped much of a beat with your REI, either, which is awesome.

    Keep up the great work!

    By Blogger Steve, at 10:12 AM  

  • Sorry I'm so far behind on reading your blog! I wanted to congratulate you and your wife!

    Also, you know I'm a buy-and-hold believer, too. But, I've decided to modify my buy-and-hold strategy to use leverage for greater prosperity. What I mean is, I've decided to only buy fixers, and to only keep them for a year--until the capital gains rate becomes 15% instead of 33%. Then, I'll exchange up to a bigger property (also a fixer). At least, for now, that's my strategy. :-D

    By Blogger Trisha#1, at 9:01 PM  

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