Unreal 3 Bed 2 Bath Section 8 Rental - Birmingham, AL 35206

This was a beautiful 3 bedroom 2 bath 1225 sqft house that I was able to purchase for 72,500. Originally listed for for 100k, with the same exact floor plan house at 130k across the street, I inspected this house personally while I was in Birmingham and was able to point out a few hidden issues with the house to knock down the buying price.

Video walk around before rehab:

For this one it seemed to just be a quick interior turn around, re-finish hardwood floors, paint interior, new lights all throughout, reglaze bathtub, updates to the kitchen, etc. The only bigger issue was with one of the cement block walls in the back of the garage. It had started to crack and needed to be reinforced. Additionally, a few trees had to be trimmed and a large dead tree behind the house had to be cut down.

Contractor Bid:

• Paint and patch interior

• Replace water lines

• Replace gas lines to hot water tank and furnace

• Replace copper lines to hvac

• Refinish hardwoods

• Replace 2 fuse boxes and a small breaker with 200 amp breaker box.

• Replace 9 lights

• Remove dead tree

• Remove dead limbs on tree near house

• Refinish bathtub

• Add quarter round to floor where gaps

• Add blinds

• Clean roof

• Repair Eves

• Section 8 prep

• Remove tree over the rear of the house

• Foundational back wall repair in the garage*

Total Bid: 26,200

Walk through video after rehab:

Numbers for this one:

Purchase price: 72,500

Rehab cost: 26,200

Total cost: 98,700

Expected ARV: 150,000/160,000 *Similar houses next door with a value of 150,000/160,000

Expected rent: 1,200

4/6/2025:

Rent: 1,336 (100% covered by HUD, the tenants portion is 0!)

Thoughts on this one; I originally went for this unit because of the location and the layout. It has 2 full baths and 3 nice bedrooms, as well as a big backyard and a huge garage. In my mind it was a safe bet even though the cost was more because of how attractive this home is to people with section 8 vouchers. I also thought better e quality of the home would provide less tenant churn I'd have to deal with, so hopefully it holds true! and overall this one is still wayy over the 1% rent to cost rule, so great deal in my mind.