Thursday, July 9, 2009
BANK OWNED! Sometimes good properties get foreclosed on because the owner does not have the time or money to complete a project. The owner gets caught behind the proverbial eight ball. A foreclosure gets started and the owner can't raise enough money to complete the job. A potentially good project becomes a bank owned reo asset. It happens all the time.
In a rising market like we had in Key West a few years ago, renovation projects were working because there was a continual flood of people that wanted to buy a second home or a condo in Key West. So many properties were purchased during that time that a lot of "work force housing" disappeared. The business model was simple: buy an old dump, fix it up to maximize monthly cash flow, and then flip it.
726-728 United Street is located on the edge of Old Town Key West, a couple of blocks east of Duval Street. It is located immediately next door to AT&T's Key West service yard complete with building and parking lot CLICK HERE. There's a trailer court across the street CLICK HERE. There is a burned out house next door CLICK HERE to the east. You could say this property is challenged. A bit.
The listing Realtor describes 726-728 United Street this way: "The four units are located in three buildings and feature bamboo and travertine floors with a shared pool and hot tub.1-2/2 and 3-1/1's. Call for a private showing. *BOA Pre-qualification must accompany all offers or proof of funds if cash." BOA means Bank of America. CLICK HERE for the detailed info supplied by listing Realtor.
But wait! Read this description of the same property last year before it was foreclosed: "Extensive renovations have been done with new kitchens, travertine and bamboo floors. Added bonus' are the pool and hot tub. All the units are in great shape. 1-2/2 and 3-1/1's. Upstairs and downstairs apartments at 726 pay $1350 each per month. Rear cottage at 728 pays $1450 per month. Front apartment at 728 pays $2100 per month on a short term rental basis. Exterior may need some finishing touches to your taste. The commercial use next door is a positive... most of the time it is quiet."
726-728 United Street is now listed for sale at $535,000 or $210 per sq ft. (That price is down from the original asking price of $625,000 when it was listed in December 2008.) The three buildings have a total of 2547 sq ft of mostly remodeled living space. The buildings sit on a large 5,0000 sq ft lot. The tenants are gone. So a new owner can start doing whatever repairs and upgrades he or she deems necessary. It's going to require more than a coat of paint and the installation of some cabinets. Somebody removed fixtures, air conditioning equipment, electric panels, etc.
Do me a favor. Put on your thinking cap and imagine the property with the downstairs front porch restored. Install shutters on the windows. Redo the entrance next door and sprinkle it with some fairy dust. Install brick pavers in the driveway (I assume that space is a driveway) and put up a white picket fence. Mend the fence on the west side of the property and clean up the swimming pool CLICK HERE, CLICK HERE and CLICK HERE. Use your imagination to envision the potential of this four unit compound.
If you are looking to buy a small investment property like 726-728 United Street, please call me, Gary Thomas, 305-766-2642.
The information on this site is for discussion purposes only. Under no circumstances does this information constitute a recommendation to buy or sell securities, assets, real estate, or otherwise. Information has not been verified, is not guaranteed, and is subject to change.
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Gary Thomas in a Nutshell
- Gary Thomas
- Key West, Florida, United States
- I first read about Key West in a magazine called "After Dark" sometime in the mid 1970's. But it wasn't until March 1984 that I made my first visit to the island that would become my home. I had two weeks for a vacation and reserved a room at Colours Guesthouse (now Marrero's Guest House) for one week. I thought that if I didn't like Key West, I could always go back to Miami or Ft. Lauderdale for the rest of my trip. But after a couple of days in Key West, that was no longer a consideration. But when I wanted to extend my stay for the extra week I found there was no room at the inn. The guesthouse owner did find me a room at LaTeDa, the infamous guesthouse/restaurant. That's a story I'll write another day. But those two weeks in Key West gave me the realization that I had found Paradise. Key West has been my home since 1993 and my only regret is that it took me so long to get here. I am a full time Realtor at Preferred Properties CRI. Let me help you find your new home or business in Paradise. Living in Paradise is not a slogan, it's a way of life.