First Flip Nearly Complete!

[Brock Salgado]

Back in October my partner @Keenan Cromshaw and I closed on our first flip property in Spanaway, WA. We purchased this 1978 manufactured home (2/2, 1,389 SF) for $200,000, planned a rehab budget of $80,000 with an ARV of $370,000. With a couple budget overruns and other unexpected expenses our margin changed from about $40,000 to around $25,000 pre-tax. As finishing touches are being completed on the rehab (we intend to list it for sale in about a month) the lessons we have learned are priceless. Among many others, we plan to keep a larger construction reserve outside the rehab budget, more conservatively estimate our numbers in these deals, and more closely inspect wholesaling contracts. Overall we are satisfied with the progress of the flip and with great teammates and partners we have (realtor/contractor), and we are ready to find our next deal and build a business serially flipping houses in the area!

[Andy Sabisch]

Sounds like you have a solid foundation after your first flip . . . . first one is the hardest and you learn some valuable lessons that you carry forward (some don't unfortunately which then become expensive redos).

Sounds like you had a lesson or two in regards to wholesalers.  Always look at the deals they bring you as having a lower ARV and a higher reno budget to be safe . . . walk away if the deal is not right number wise . . . we have done that and find some wholesalers are pretty much spot on and others are living in a fairytale world.

Hope you take the area by storm . . . learn from each one and hone your tools so you find the deals others struggle to find.