How much would you offer for this condo

[surveyor]

insurance

You forgot to put in your insurance cost.

I’m sure there are other costs, but the insurance cost is mandatory (about $900/yr if you go cheapo).

Other than that, it does look like it will breakeven, but I would recommend trying to get the property lower than $120k, so that you can get more credit for the $20k fix up cost.

My price? Probably around $105k. ($125k including $20k fixup cost).

[nostradamus]

Hi cv,

Where do you get the $20k estimate? I’ve just had quotes from 3 different contractors to redo a bathroom which isn’t nearly as trashed as those, and the quotes were in the $10k range per bathroom (including basic tiles, countertops, etc). I’d say $20k just for the bathrooms. Then you have the kitchen, which will be vital for the picky renter. Then again, a picky renter might not be renting in this area. Anyhow, the quotes I got were for superficial things, not plumbing or wiring or drywall or other, like this unit surely needs. So I’d say $50k+ to fix it up. You can always do the work yourself (I’ve been doing my own bathrooms, it’s coming out great) for much cheaper but have to invest a lot of time.

You also have closing costs to think about, is that part of your $150k estimate? I see you’re already thinking about the special assessment, this is good. If there are a lot of vacancies (you mentioned REOs) then there is a good chance you will be assessed or just plain raise the HOA to cover the lack of HOA dues paid by those vacancies.

Heaven forbid you should end up with a disgruntled renter. I would aim for an engineer or other professional to rent your unit, and be picky about it. If you fix the place up nice and present it well, and are thorough in choosing your tenant, you can break even.

That being said, you can also break even if you wait 5 years. Don’t worry about rates going up, because this is a cash-only sale so rates do not affect you other than to lower the sales price! The ONLY reason I’d say “buy now” is if you were affected by interest rates but even that is debatable.

[nostradamus]

Hi cv,

Where do you get the $20k estimate? I’ve just had quotes from 3 different contractors to redo a bathroom which isn’t nearly as trashed as those, and the quotes were in the $10k range per bathroom (including basic tiles, countertops, etc). I’d say $20k just for the bathrooms. Then you have the kitchen, which will be vital for the picky renter. Then again, a picky renter might not be renting in this area. Anyhow, the quotes I got were for superficial things, not plumbing or wiring or drywall or other, like this unit surely needs. So I’d say $50k+ to fix it up. You can always do the work yourself (I’ve been doing my own bathrooms, it’s coming out great) for much cheaper but have to invest a lot of time.

You also have closing costs to think about, is that part of your $150k estimate? I see you’re already thinking about the special assessment, this is good. If there are a lot of vacancies (you mentioned REOs) then there is a good chance you will be assessed or just plain raise the HOA to cover the lack of HOA dues paid by those vacancies.

Heaven forbid you should end up with a disgruntled renter. I would aim for an engineer or other professional to rent your unit, and be picky about it. If you fix the place up nice and present it well, and are thorough in choosing your tenant, you can break even.

That being said, you can also break even if you wait 5 years. Don’t worry about rates going up, because this is a cash-only sale so rates do not affect you other than to lower the sales price! The ONLY reason I’d say “buy now” is if you were affected by interest rates but even that is debatable.

[nostradamus]

Hi cv,

Where do you get the $20k estimate? I’ve just had quotes from 3 different contractors to redo a bathroom which isn’t nearly as trashed as those, and the quotes were in the $10k range per bathroom (including basic tiles, countertops, etc). I’d say $20k just for the bathrooms. Then you have the kitchen, which will be vital for the picky renter. Then again, a picky renter might not be renting in this area. Anyhow, the quotes I got were for superficial things, not plumbing or wiring or drywall or other, like this unit surely needs. So I’d say $50k+ to fix it up. You can always do the work yourself (I’ve been doing my own bathrooms, it’s coming out great) for much cheaper but have to invest a lot of time.

You also have closing costs to think about, is that part of your $150k estimate? I see you’re already thinking about the special assessment, this is good. If there are a lot of vacancies (you mentioned REOs) then there is a good chance you will be assessed or just plain raise the HOA to cover the lack of HOA dues paid by those vacancies.

Heaven forbid you should end up with a disgruntled renter. I would aim for an engineer or other professional to rent your unit, and be picky about it. If you fix the place up nice and present it well, and are thorough in choosing your tenant, you can break even.

That being said, you can also break even if you wait 5 years. Don’t worry about rates going up, because this is a cash-only sale so rates do not affect you other than to lower the sales price! The ONLY reason I’d say “buy now” is if you were affected by interest rates but even that is debatable.

[nostradamus]

Hi cv,

Where do you get the $20k estimate? I’ve just had quotes from 3 different contractors to redo a bathroom which isn’t nearly as trashed as those, and the quotes were in the $10k range per bathroom (including basic tiles, countertops, etc). I’d say $20k just for the bathrooms. Then you have the kitchen, which will be vital for the picky renter. Then again, a picky renter might not be renting in this area. Anyhow, the quotes I got were for superficial things, not plumbing or wiring or drywall or other, like this unit surely needs. So I’d say $50k+ to fix it up. You can always do the work yourself (I’ve been doing my own bathrooms, it’s coming out great) for much cheaper but have to invest a lot of time.

You also have closing costs to think about, is that part of your $150k estimate? I see you’re already thinking about the special assessment, this is good. If there are a lot of vacancies (you mentioned REOs) then there is a good chance you will be assessed or just plain raise the HOA to cover the lack of HOA dues paid by those vacancies.

Heaven forbid you should end up with a disgruntled renter. I would aim for an engineer or other professional to rent your unit, and be picky about it. If you fix the place up nice and present it well, and are thorough in choosing your tenant, you can break even.

That being said, you can also break even if you wait 5 years. Don’t worry about rates going up, because this is a cash-only sale so rates do not affect you other than to lower the sales price! The ONLY reason I’d say “buy now” is if you were affected by interest rates but even that is debatable.

[nostradamus]

Hi cv,

Where do you get the $20k estimate? I’ve just had quotes from 3 different contractors to redo a bathroom which isn’t nearly as trashed as those, and the quotes were in the $10k range per bathroom (including basic tiles, countertops, etc). I’d say $20k just for the bathrooms. Then you have the kitchen, which will be vital for the picky renter. Then again, a picky renter might not be renting in this area. Anyhow, the quotes I got were for superficial things, not plumbing or wiring or drywall or other, like this unit surely needs. So I’d say $50k+ to fix it up. You can always do the work yourself (I’ve been doing my own bathrooms, it’s coming out great) for much cheaper but have to invest a lot of time.

You also have closing costs to think about, is that part of your $150k estimate? I see you’re already thinking about the special assessment, this is good. If there are a lot of vacancies (you mentioned REOs) then there is a good chance you will be assessed or just plain raise the HOA to cover the lack of HOA dues paid by those vacancies.

Heaven forbid you should end up with a disgruntled renter. I would aim for an engineer or other professional to rent your unit, and be picky about it. If you fix the place up nice and present it well, and are thorough in choosing your tenant, you can break even.

That being said, you can also break even if you wait 5 years. Don’t worry about rates going up, because this is a cash-only sale so rates do not affect you other than to lower the sales price! The ONLY reason I’d say “buy now” is if you were affected by interest rates but even that is debatable.

[cv2]

Thanks surveyor and nostradamus.

surveyor: HOA should have master insurance so I just need to get a ride-on policy. Probably $600 a year so that’s $50/month.

nostrademus: The bathroom downstairs has no tub/shower, so just a sink.

I estimated the repair cost:
bathroom: $3,000
Washer/dryer: $1,000
Frig: $500
Dishwasher: $400
Range: %500
Countertop and Cabinets under: $10,000.
Flooring: $4,000
So it is close to $20,000.

I did not take closing cost in. That’s probably another $4,000 up front: escrow and loan points/fees.

Honestly I do not buy for appreciation because I think it is very dangerous to assume that things will look up substantially in 5 years. On the contrary I think we are still on a down slope. I only buy when the numbers make sense. That’s why I want to stay cash-flow positive as much as I could.

I am not very familiar with that area. All I know is that it is close to Miramar college and hopefully I could attract some college students or young professionals. Two bedrooms but with only one full bath is not very desirable.

Thanks!

[cv2]

Thanks surveyor and nostradamus.

surveyor: HOA should have master insurance so I just need to get a ride-on policy. Probably $600 a year so that’s $50/month.

nostrademus: The bathroom downstairs has no tub/shower, so just a sink.

I estimated the repair cost:
bathroom: $3,000
Washer/dryer: $1,000
Frig: $500
Dishwasher: $400
Range: %500
Countertop and Cabinets under: $10,000.
Flooring: $4,000
So it is close to $20,000.

I did not take closing cost in. That’s probably another $4,000 up front: escrow and loan points/fees.

Honestly I do not buy for appreciation because I think it is very dangerous to assume that things will look up substantially in 5 years. On the contrary I think we are still on a down slope. I only buy when the numbers make sense. That’s why I want to stay cash-flow positive as much as I could.

I am not very familiar with that area. All I know is that it is close to Miramar college and hopefully I could attract some college students or young professionals. Two bedrooms but with only one full bath is not very desirable.

Thanks!

[cv2]

Thanks surveyor and nostradamus.

surveyor: HOA should have master insurance so I just need to get a ride-on policy. Probably $600 a year so that’s $50/month.

nostrademus: The bathroom downstairs has no tub/shower, so just a sink.

I estimated the repair cost:
bathroom: $3,000
Washer/dryer: $1,000
Frig: $500
Dishwasher: $400
Range: %500
Countertop and Cabinets under: $10,000.
Flooring: $4,000
So it is close to $20,000.

I did not take closing cost in. That’s probably another $4,000 up front: escrow and loan points/fees.

Honestly I do not buy for appreciation because I think it is very dangerous to assume that things will look up substantially in 5 years. On the contrary I think we are still on a down slope. I only buy when the numbers make sense. That’s why I want to stay cash-flow positive as much as I could.

I am not very familiar with that area. All I know is that it is close to Miramar college and hopefully I could attract some college students or young professionals. Two bedrooms but with only one full bath is not very desirable.

Thanks!

[cv2]

Thanks surveyor and nostradamus.

surveyor: HOA should have master insurance so I just need to get a ride-on policy. Probably $600 a year so that’s $50/month.

nostrademus: The bathroom downstairs has no tub/shower, so just a sink.

I estimated the repair cost:
bathroom: $3,000
Washer/dryer: $1,000
Frig: $500
Dishwasher: $400
Range: %500
Countertop and Cabinets under: $10,000.
Flooring: $4,000
So it is close to $20,000.

I did not take closing cost in. That’s probably another $4,000 up front: escrow and loan points/fees.

Honestly I do not buy for appreciation because I think it is very dangerous to assume that things will look up substantially in 5 years. On the contrary I think we are still on a down slope. I only buy when the numbers make sense. That’s why I want to stay cash-flow positive as much as I could.

I am not very familiar with that area. All I know is that it is close to Miramar college and hopefully I could attract some college students or young professionals. Two bedrooms but with only one full bath is not very desirable.

Thanks!

[cv2]

Thanks surveyor and nostradamus.

surveyor: HOA should have master insurance so I just need to get a ride-on policy. Probably $600 a year so that’s $50/month.

nostrademus: The bathroom downstairs has no tub/shower, so just a sink.

I estimated the repair cost:
bathroom: $3,000
Washer/dryer: $1,000
Frig: $500
Dishwasher: $400
Range: %500
Countertop and Cabinets under: $10,000.
Flooring: $4,000
So it is close to $20,000.

I did not take closing cost in. That’s probably another $4,000 up front: escrow and loan points/fees.

Honestly I do not buy for appreciation because I think it is very dangerous to assume that things will look up substantially in 5 years. On the contrary I think we are still on a down slope. I only buy when the numbers make sense. That’s why I want to stay cash-flow positive as much as I could.

I am not very familiar with that area. All I know is that it is close to Miramar college and hopefully I could attract some college students or young professionals. Two bedrooms but with only one full bath is not very desirable.

Thanks!

[nostradamus]

Well it couldn’t hurt to go take a look and see what actually needs to be done on the condo. Usually the photos REAs post are the ones that make it look good. Your condo’s photos don’t look good at all so imagine what they’re not showing you.

Run the faucets, flush the toilets, turn on/off everything electrical, run any remaining appliances, check for mold or wood rot or termites or carpet beetles, look for dark spots on the walls close to the ceiling (indicating roof leaks), talk to the upstairs/downstairs neighbors, and video/photo everything for later review/negotiation. Walk around the property and look for graffiti or junk or hazards. See if any cars were broken into, see if the public areas will require “special assessment” like new pool heater, resurfacing the parking lot, repainting the exterior, fix leaking roofs, etc.

I personally don’t like anything too close to the freeways. For MM I don’t like much East of Cam. Ruiz. I think you can find some bargains between Cam. Ruiz and Cam. Santa Fe, to the South of Mira Mesa Blvd. In a year or two you can find bargains to the North of MMB in that area. This is all IMO. One reason I like West of Cam Ruiz is because it is close enough to Sorrento Valley to get good renters, yet it is also close enough to Vons/Seafood City/Edwards Cinemas etc.

[nostradamus]

Well it couldn’t hurt to go take a look and see what actually needs to be done on the condo. Usually the photos REAs post are the ones that make it look good. Your condo’s photos don’t look good at all so imagine what they’re not showing you.

Run the faucets, flush the toilets, turn on/off everything electrical, run any remaining appliances, check for mold or wood rot or termites or carpet beetles, look for dark spots on the walls close to the ceiling (indicating roof leaks), talk to the upstairs/downstairs neighbors, and video/photo everything for later review/negotiation. Walk around the property and look for graffiti or junk or hazards. See if any cars were broken into, see if the public areas will require “special assessment” like new pool heater, resurfacing the parking lot, repainting the exterior, fix leaking roofs, etc.

I personally don’t like anything too close to the freeways. For MM I don’t like much East of Cam. Ruiz. I think you can find some bargains between Cam. Ruiz and Cam. Santa Fe, to the South of Mira Mesa Blvd. In a year or two you can find bargains to the North of MMB in that area. This is all IMO. One reason I like West of Cam Ruiz is because it is close enough to Sorrento Valley to get good renters, yet it is also close enough to Vons/Seafood City/Edwards Cinemas etc.

[nostradamus]

Well it couldn’t hurt to go take a look and see what actually needs to be done on the condo. Usually the photos REAs post are the ones that make it look good. Your condo’s photos don’t look good at all so imagine what they’re not showing you.

Run the faucets, flush the toilets, turn on/off everything electrical, run any remaining appliances, check for mold or wood rot or termites or carpet beetles, look for dark spots on the walls close to the ceiling (indicating roof leaks), talk to the upstairs/downstairs neighbors, and video/photo everything for later review/negotiation. Walk around the property and look for graffiti or junk or hazards. See if any cars were broken into, see if the public areas will require “special assessment” like new pool heater, resurfacing the parking lot, repainting the exterior, fix leaking roofs, etc.

I personally don’t like anything too close to the freeways. For MM I don’t like much East of Cam. Ruiz. I think you can find some bargains between Cam. Ruiz and Cam. Santa Fe, to the South of Mira Mesa Blvd. In a year or two you can find bargains to the North of MMB in that area. This is all IMO. One reason I like West of Cam Ruiz is because it is close enough to Sorrento Valley to get good renters, yet it is also close enough to Vons/Seafood City/Edwards Cinemas etc.

[nostradamus]

Well it couldn’t hurt to go take a look and see what actually needs to be done on the condo. Usually the photos REAs post are the ones that make it look good. Your condo’s photos don’t look good at all so imagine what they’re not showing you.

Run the faucets, flush the toilets, turn on/off everything electrical, run any remaining appliances, check for mold or wood rot or termites or carpet beetles, look for dark spots on the walls close to the ceiling (indicating roof leaks), talk to the upstairs/downstairs neighbors, and video/photo everything for later review/negotiation. Walk around the property and look for graffiti or junk or hazards. See if any cars were broken into, see if the public areas will require “special assessment” like new pool heater, resurfacing the parking lot, repainting the exterior, fix leaking roofs, etc.

I personally don’t like anything too close to the freeways. For MM I don’t like much East of Cam. Ruiz. I think you can find some bargains between Cam. Ruiz and Cam. Santa Fe, to the South of Mira Mesa Blvd. In a year or two you can find bargains to the North of MMB in that area. This is all IMO. One reason I like West of Cam Ruiz is because it is close enough to Sorrento Valley to get good renters, yet it is also close enough to Vons/Seafood City/Edwards Cinemas etc.

[Author]

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