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What do you look for in a house to fix up and sell?

I don't want to sell them, I want to keep them and rent them out. When I'm ready to retire from being a landlord (which may never actually happen because I really enjoy it) my plan is to sell them and offer seller financing. The idea is to continue to earn a bit of money on them (through interest income) while helping out the next generation of investors.

But what I look for are:

Good bones - no structural issues in the foundation, which, in the area I buy in would not be worth the expense to fix. No rotten structural supports on porches, etc. for safety reasons.

Major systems already in place - upgraded wiring, healthy heating system (I love boilers), sound plumbing.

A roof and exterior that "will do" for at least 2-3 years.

A beat up or dirty interior - reduces price and reduces competition for the property, just takes a bit of elbow grease to fix. I'm a master with the plaster. :)

A yard in need of overhaul - I love landscaping and can tackle this over time.

A garage - just makes it more appealing to prospective tenants to not have to scrape snow off their cars in the winter.

I like doubles with a minimum of two bedrooms per unit and at least 1000 sq' per unit. The neat thing about doubles is that even if one unit is unoccupied, you've still got money coming in.

A seller who, for whatever reason, is willing to sell below market. I use bank financing because I'm comfortable with it.

A house that will "cash flow" as soon as it's fully rented, even if it's just a few bucks. After the initial purchase and fix up, the house needs to be able to pay for any additional work it needs out of the income it generates.

I live in a suburb of Cleveland. I buy in Cleveland proper, in a nice little blue collar neighborhood that I'm familiar with (I dated a couple of guys who lived there and used to go for a lot of walks). The houses in that neighborhood support rents comparable to the rents in the nearby suburbs, but the houses sometimes sell for 2/3 to 1/2 what the houses in the nearby suburbs sell for.

The one we have bought itself new siding, windows, roof, insulation and gutters about a year and a half ago. We financed the upgrades over 12 years at 5%, and that darned cash cow is still cash flowing for me - not as high as it was, but over $100 every month, after deducting for regular expenses and planned maintenance expenses. And that's probably the last major investment that house will need in my lifetime.

I hope that answers your question. :)

SS
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