This is a good time to invest in a foreclosure--lots of properties to choose from and low interest rates. You'll probably also be able to find good prices on building materials in this economy. However, close proximity to a major highway--or even a very busy street eliminates a large pool of buyers from the beginning of their search. I had a listing in the Williamsburg subdivision in east Northbrook a few years ago. It's an interesting area near Northbrook Court. The houses are mainly 4-5 bedrooms with good floor plans; some have been more updated than others. However, because part of this subdivision is bordered by the expressway, location within the complex seriously impacts the desirability of the homes. The listing I had was in one of the quietest parts of the complex far from the highway--it was nicely updated and sold with multiple offers for full price (hotter market, of course), but owners of homes near the highway were prepared to sell for substantially less.
Therefore, given the large inventory of homes, I'd advise you to find a foreclosure in a better location and eliminate one major selling obstacle off the bat. Remember, buyers today can afford to be very picky since the inverntory levels are still very high. Do a consistently high quality job of renovating throughout the house and you'll set yourself up for success. Let me know if you'd like some tips regarding the renovation that would attract buyers.
Baird & Warner
50 year old ranch full of mold, sounds like pure profit to me!
Anyway, to answer your original question of what it will sell for fixed up, the only way I could give you a meaningful answer would be to build a regression model for you, that's what I do for my other investor clients.
Evan, why do you think it will take more than 40k to fix? Do you know something about the condition of the house that I don't? I am doing all the work myself so I don't have to hire contractors, I've done it before. The only thing I can't do is roofing and siding (if it's needed).
Also, I intend to live in it until it's done.
What better investments? Been looking for 6 months, and all I see are 50+ year old ranches, most of them full of mold.
At times what appears to be a GREAT deal however backs up to busy street with road noise could prevent buyers wanting to purchase.
Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
Without seeing the home and location, it is hard to put a dollar amount to being close to the tollway versus the location of the other homes in the $400-450,000 range. One of the main words in real estate is Location, Location, Location!
My advice is to take the worst case situation, what are you paying for the house including all closing costs, how much will you need to spend to bring it to the shape of the $400-450,000 homes, what will it cost to sell it (including taxes, real estate commission...etc). Take into account a good margin for the location and what other homes are available for sale and if the numbers work, go for it.
Long & Foster Real Estate, Inc
Lehigh Valley, PA