Livin' La Vida Luna y Luca
Had to go back and grab a "first day of school" pic with all 4 of us this week.
Locking this one in felt good. REAL good.
This seller first called us back in May of 2025. My partner and I went on the walkthrough, and we offered them exactly what they wanted (at the time).
But they weren't quite ready. They're an older couple looking to downsize into a home that checks all of their boxes.
I bided my time. I checked in every month or so to let them know I was still interested.
Then the above text came in. "Can we still do business?"
To say I was giddy would be an understatement. They ultimately passed on the property they were looking at, but I didn't hesitate.
I struck while the iron was hot, and they agreed to move towards a contract. After a few rounds of negotiating, we locked it up with a flexible closing date.
The agent I prefer to work with in this town is now helping these sellers find their next home. Win-Win-Win.
The Numbers:
Let's quickly run through the numbers.
We'll start with three buckets of expenses and end with our expected After Repair Value.
Acquisition Costs:
We're buying the home for $900K. After all commissions, fees, and closing costs, we'll be into this home for just over $940K
Cost to Build & Carry:
We're building a big boy here. I'm excited to share the plans once we have them.
R&D: Ripoff & Duplicate
We already identified the home we're modeling for the build. There are a handful of opportunities for improvement, but it's mostly going to be a mix of the pictures above and Project Townsend Part II.
Cost to Sell:
More than a quarter M for the costs associated with sale. Yikes. Just going to pretend that number is foogazey.
...moving on
After Repair Value:
Here's where things get a little sticky.
There are homes that sell for $4M within a stone's throw of this property. However, we're on a double yellow, and this lot doesn't quite "belong" to the same sub-section of town as those $4M homes.
Mean Girls: Home Edition.
Purchase Comps
There are 2 purchase comps that sold for ~$200K more than what we're paying, which is good. We're definitely getting in at the right price.
Sold Comps
Excluding the homes that belong to the $4M neighborhood around the corner, these are the two comps I'm underwriting to.
I think we're going to sell somewhere between $2.5 and $3M w/ a heavy lean towards $3M.
What's Next?
Tank sweep came back clean. Survey is in. Now we develop plans.
While we work on that, our preferred agent will help the sellers find their next home.
Until then, we practice patience. 🧘🏽♂️
✌🏽&❤️