I was out showing a client some high end homes in a local Lake Conroe subdivision named Bentwater by Lake Conroe a week ago and came across an interesting opportunity for a lucky investor client of Icon Realty….
Click to learn more about Bentwater.
We were out looking at homes in the $800k range and stumbled upon an unfinished new construction home that is sitting right on the golf course. I decided to investigate further and come to find out the builder is going bankrupt and the house is currently being sold as a short sale with the possibility of going into foreclosure very soon. So I immediately put on my investor hat and started calculating some numbers, and really liked the potential that this home has to offer for a potential investor.
I decided to take it a step further and brought out a trusted contractor contact of mine to price out what it would take to finish the home and have it comparable to the rest of the homes in this luxurious neighborhood. As the home stands now, the exterior construction is complete (Stucco), and the interior still needs to be finished. Based on his assessment he is figuring the house needs another 125k-150k to trim and finish it out.
Let me give you some details of the home:
- The home is 4532 sq ft.
- It sits on a 11682 sq ft. golf course lot with a water view of Lake Conroe on the 11th hole of the Miller course
- The house is 5 bedrooms 4.5 baths with a game room
- Has an outdoor kitchen and a great view of the golf course and lake
- Currently asking for $525,000
- My goal would be to acquire this property for $400,000, but it is still solid at $450,000
- View more info including a few pictures here – I will take more pictures at an investors request if needed.
Now I don’t want you to get bored reading a long blog posting so I’m going to keep this short and if you are interested I can answer any questions you could possibly have about the property. At your request, I will provide you with a detailed assessment.
So here are my thoughts on this investment property:
Just doing the basic math on this unfinished property compared to what I’ve seen throughout the neighborhood. Say the bank accepts our offer of $400k and you have to put $100k-$150k into the home to finish it out correctly. Taking the square footage of the home (4532) divided by $550k (worst case based on the $400k offer price scenario) comes out to $121 dollars per sq ft.
Comparable properties have been selling @ $165 per sq ft. including a few of the homes I have looked at already. You could turn around and sell this property after finishing it for $750k minimum. After capital gains taxes, and the fees associated with selling this property, we are talking about netting a profit of @ $140k – $150k. Of course you would recover all of your money invested into finishing the home as well. Should you go through with something like this, I would definitely work with you on my sales commission when it comes time to sell, in order to maximize your profit. This is a rare opportunity for a high return in a short amount of time. I’ll put it to you another way, if I had the money right this second i would jump all over this in a heartbeat!
I have comparables to support my claims, and all the info an investor would need to jump on this and complete this home. Now this isn’t going to be an easy transaction (especially the short sale part), but with a little bit of patience and Icon Realty’s supervision you will be sitting on the beach in Maui next fall sipping on Mai Tai’s thanking Icon Realty for providing you with this opportunity. Call Jeremy today at 832-622-8100 or larkin@houstonicon.com
