Buying Cheap Houses | Rural Small Town Investing

hey how's it going you guys it's scott with everyday home repairs and on this video we're going to dive into a property i recently purchased we're not really going to do any specific how-to i'm not going to show you how to change out a faucet or how to install an interior door so it's a little bit different from what we're normally putting on the channel but i think it is of interest and a few of you have mentioned in the comments that you're interested in knowing more about these properties that i purchase the interesting thing about this one is it's right there around a ten thousand dollar house which depending on where you live might sound insane that you can actually buy a property like this one with a roof and actually standing for ten thousand dollars but you can this is kind of small town investing in my area it's rural community investing there is some advantages to that but there's also things that you need to be careful of or consider so what i'm going to run you through we'll walk around the outside to show you the property show you the lot then we'll dive inside it's already been cleaned out so you can see the layout of the house and i'll show you some of the challenges or issues that you need to face on a property like this an older home that needs some love that needs some attention but if willing this is a great way to buy a property for yourself put a ton of sweat equity in and then have a nice buffer of equity which is the difference between what you paid what you have invested in home and what it's worth so maybe you're just interested for yourself how do you keep your cost of living as low as possible but still have a good or great home or you're looking to get investing maybe you have a certain amount of cash you want to invest and this way you're doing it without banks usually which can really expedite the process and make things a little bit easier so let's walk around outside i'll kind of show you the lay of the land and show you the outside of the house so the home was built in the early 1900s and when i purchased these properties i kind of want to piece through what happened to them over time so this was the original home and then this new there's kind of a flat roof there and then the pitch roof as an addition it's a kitchen that was built afterwards and you kind of tell that from the roof line but also in the basement because the kitchen only has a crawl space under it so this property had hail damage just a couple years back and that is also how it got a new roof from an insurance claim now it's a cute older home but with an older home there are some challenges you can see that window right there see how crooked that is so we'll show you in the basement what's going on now this home for years has had downspouts off water going right along the base kind of washing out this area and actually putting a lot of dirt in the basement which i'm digging out currently now this overall lot is huge the lot is 150 feet by 207 feet so i think that works out to about 0.7 acres so overall the home is pretty cute and it does have some monster trees on the property which gives you actually great shade and does help to cool the house now obviously when you're buying properties like this you're gonna have older windows most likely possibly you would have vinyl replacement windows this one has a lot of the older windows so these are all things you need to take into consideration depending on what you want to do with the property now here's the west side of the home you can see it actually has a single car garage that's on the lower level which is kind of interesting what i like about this lot it has enough elevation change there should be no issues in getting the water away from the home even though that was not done in the past and has caused some issues but that's pretty much the outside so let's dive in on the inside and take a look so here is that little addition that i said has a crawl space under it so this was a bigger kitchen that was put in place so we're missing that was a cook top here that would have been your oven so we're missing some appliances but again for a ten thousand dollar home often you are missing also a refrigerator uh that is something you're gonna have to take into account now you're not gonna really be able to tell as much but the floors do have some issues they are sloping a bit the floors are not in terrible condition but most people would probably just come through here and put in carpet now there is some structural issues and some of the telltale signs as you can actually see parts of the home separating and thus the wood floor is starting to separate so this single bathroom the only bathroom in the home is starting to separate in addition to this little laundry room but when you're buying houses for ten thousand dollars i mean a lot of the things i'm looking at are things like the issue we see with the structure smells so if there's been pets in here and there are floors that are soaked with pet urine i mean that's stuff you got to take into consideration because it's going to be hard to get those smells out and that will cost you money now here remember on the outside we saw that sloping window so you can sleep see the plaster has significant cracks i'll show you in the basement what's going on there was termite damage so one of the main structural beams needs to be actually just completely replaced but overall the layout the the space is not bad there's one bedroom on the lower level obviously super dated carpet wood paneling but just give you guys an idea of kind of what you get in some of these rural communities for some of these old homes for 10 000 or so night a very steep staircase this staircase would not be current code you see a nice crack in the wall there now this is kind of a bonus room i wouldn't necessarily call this a bedroom so this home has three bedrooms and one bath about 1300 square feet this would be one of the bedrooms so it's really just got a sub floor right now the old planks this is more signs of the home having some separation so on this side is your chimney coming up through and then on this other side would be part of the home that has settled out and that structural beam is giving way it just has small little closet off to the side and here's that other room actually the rooms are pretty good size and again with some some help some tlc this home could be put back into shape now because this is a story and a half you're gonna have the ceiling sloping in you're gonna have some kind of low clearance in terms of headroom as well all right now let's go down to the basement so if you didn't know the walls were plaster here's a good way to see the lath and plaster on the back side and also you have exposed knob and tube and some patchwork do be careful on this if if you're not comfortable with this type of work this could be something that would be very very expensive and just something you need to consider if you're going to take on a project like this now that is the garage that we saw from the outside is the little crawl space and how i knew the kitchen was added on afterwards and all of this actually had dirt in it had about let's say two or three inches of dirt that i've dug out and you can see we are not done digging so that's gonna go back to quite a bit of dirt on that corner that's the source of it that's where the water was coming in from those downspouts pouring water back to the base back to the foundation that is why it is critical to get water away from your home but this really happened over probably 10 or 15 years this type of damage doesn't happen overnight and if we're looking for the damage for that structural beam let me show you what's going on if you didn't know what termite damage looked like well there you go this was chewed on for a long long time to create that much damage now this is your main structural beam and this is the area that's sagging the most in the home so that needs to be addressed completely replaced and a lot of these joists need to be actually replaced you can see how bad some of those are damaged now if this looks intimidating it should actually intimidate you especially if you haven't done this before and if this would be like your first time homebuyer although the price is attractive i would not recommend that now we've had some reinforcement on the foundation walls over the years they're in okay condition but really that structural beam is the main thing that needs help right now now the electrical system is a bit of a cobbled together mess so we have a electrical panel with circuit breakers traditionally this box would be what's called a 60 amp box but it has a 100 amp breaker in it so you have older romex going out but then that is honestly splicing in to older wiring which would be your old knob and tube wiring for most of your switches and most of your receptacles so we didn't talk much about the plumbing but it just needs help so we got lines hanging all over the place this would be a candidate for a complete re-plumb and i would probably lean towards pax so that gives you a little better idea of what at least in my area ten thousand dollars will get you now if you're not scared away yet i'm going to run through the numbers how much do i actually spend on this home compared to what i'm going to sell it for and then also i'll let you know how do you find these type of deals what would be some ways that you could go about to get yourself a home like this if it's something you're interested in living in or as an investment so purchase price of this home was ten thousand five hundred dollars now dumpsters and a little bit of labor i actually did quite a bit the labor myself so i'm not including my labor numbers that's the labor that i put towards closing on this property doing the clean out digging out that dirt i spent about 40 hours a work week on this property but not including those 40 hours i spent 1300 in two 20-yard dumpsters and just a little bit of labor with some guys helping me for half a day then closing so i had two different closings buying and selling i only spent 1250 towards the closing costs and the recording fees associated to that then because i still do use a lawyer on both sides that's a 900 charge and then property taxes and utilities i only spent about 400 on this property because i'm only going to hold it for about seven weeks total from when i bought it to closing on the sell side so all together that puts me at three hundred fifty dollars of investment that i have in this property i'm selling this property in a couple weeks for twenty one thousand five hundred assuming that that goes through uh since it's a cash offer from an investor and that investor is going to do the rehab on this pro property and either resell it or keep it as a rental that puts me at a profit of 7 150 now for me this is not a home run but i like doing these deals where i'm not putting too much time into it it gets me a little content for my youtube channel i did a couple videos on this property but it's not a big time commitment for myself now how would you find this property now how i find this property i do online marketing facebook instagram a few other sources they go to my website people fill out the form saying hey i want to sell my house in this area then i contact them and we go through the normal process of negotiating and then if we can come to terms on the price i purchased the property i'm assuming you don't have that set up right you don't have online advertising you're not sending out postcards or yellow letters which is another way to get off market deals these are not on the market or not on what's called the multi-listing service or the mls but if you just want to hustle and not put that in place you can do what's called driving for dollars and it's just that you're driving around you're canvassing through a community maybe a small town or a part of your city and you're just looking for signs that that property is not being taken care of often the exterior might look terrible maybe a door is hanging off the hinges the storm doors wide open the grass hasn't been cut for a couple months the landscaping's a mess those are all signs that hey i don't really value this home i don't really want this home those are your prospective sellers so what you can do is just google your local county and google the tax assessor or tax lookup website what you'll do is you'll look up that address and you can find who is paying the property taxes on that and what is their mailing address and you can make the message very simple you say my name's such and such i am a local investor or i just want my first house and i saw this house if you ever want to sell just let me know here's my number really it can be that simple and that can generate leads it's not going to happen on your first it's not going to happen on your 10th it might not even happen on your first 100 times you do that so you do have to hustle to find these type of deals but they are out there if you put in the work so that's it give you guys a little more insight on another part of my business outside of youtube if you have any questions i love talking about this stuff just let me know i'd be happy to help you guys out and at least give my two cents if you're looking for this type of home for yourself or as an investment if you want to go deeper into another deal that we did not too long ago here's another video it'll go through the property it's another small town deal it'll give you all the financials so you have another example of how this works if not thanks for stopping by and we'll catch you guys in the next video take care

Channel: Everyday Home Repairs

Views: 210,534

Keywords: real estate investing, investing in rural areas, fix and flip houses, off market real estate deals

Id: tV6cL_zho24

Length: 15min 41sec (941 seconds)

Published: Thu Sep 30 2021