UTAH REAL ESTATE INVESTOR

In this video I walk through a brief property analysis to evaluate the potential of a property in American Fork, UT for subdivision (lot split) possibility. This property has been on the market for about 1 year because the asking price does not justify what the property can become.

This property needs 150 feet of frontage to subdivide into 2 lots. Many people have approached the neighbors about buying the missing land but the neighbors do not want to sell. Using Highest & Best Real Estate Investing techniques we uncover another option.

This video goes through the steps of the initial property analysis to determine if there is enough potential to pursue this property (and move to the next step in the evaluation process).

Below are the images of the properties used in the video. Click on each image to see a larger (more readable) picture.

I have listed a home in Pleasant Grove, UT that is an approved short sale. The home owners originally bought this home for about $175,000. According to the lender’s BPO the property is now only worth $150,000. However, the lender has already indicated that they are willing to sell the property for $135,500! A buyer on this property would start of with nearly $15,000 in instant equity. That is absolutely fantastic in this market.

The home has 3 bedrooms, 1 bathroom, 2 family rooms, 1,210 square feet and central A/C. This home is conveniently located with easy access to Main St (Geneva Road), State Street and I-15 (at the new Pleasant Grove exit). It is also located near shopping (including Wal-Mart) and schools.

The lender has approved a price of $135,500. A buyer (who would live there) could get an FHA loan with 3 1/2% down payment ($4,750) and have a 30-year fixed rate loan at 5.5% giving a principal and interest (PI) payment of $742.38. Not only that, as a first time home owner this buyer would also get $8,000 tax credit (refund) next year; that would make the first year’s payments effectively only $75.71/mo!

An investor could buy this property with a 20% down payment ($27,100) and get a 30-year fixed rate loan of 6.5% with a PI payment of $685.16. A 3 bedroom home average rent in Pleasant Grove is $1,000/mo. This gives the home at least $200/mo positive cash flow ($2,400/year) or a 9% ROI on the invested money, not including tax benefits.

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