1st Flip - Success story

[Bryan C.]

Hello all,  my name is Bryan & this is a short post about my 1st flip success story (pending closing).

I decided just over 1 yr ago that I was going to become a real estate investor more actively. I had already been a passive investor on a few rentals for several years at that point. So I spent the next 6 months educating myself through reading, blogs, youtube videos, networking, reading forums on Biggerpockets & talking to other investors on Biggerpockets. So I decided to take the leap despite being Military and stationed overseas (my goals are to build a business enough while still being Active Duty military...this will allow me to enjoy retirement in 9 yrs). After a couple months of searching I found a few deals through the MLS that were decent with the financial #s even if they fell more into the $30k PIGS that some of you talk about (I disagree to a certain extent on the $30k homes being PIGS if you know what your doing and become selective on the deals you get involved in) & made some offers....after some back and forth on things I eventually settled on a home that needed rehab. I bought it for $15k, put $30-35k into it & rent it out for $800/mo (about $400/mo cashflow after tax, insur, PM, 10% vacancy & 10% repairs). I learned a few things while going through this process that I will keep in mind for future deals (much easier to get cosmetic repairs done with minimal surprises vs the bigger repairs due to being stationed overseas with the Military). At the same time I still had a good chunk of money available to invest in something else. I decided I wanted to get some experience with flips & partnered with some locals that I got to know over the last year. We formed a JV deal where I provided most of the money side & they provide the sweat equity. Obviously we made a few mistakes that cost us time & money, but the key was that we got into a deal that gave us the freedom to make some of those mistakes and grow without putting us upside down or in the hole. So here is some info on it...

We bought the property in Cincinnati, OH mid-Apr, rehabbed it, listed it & scheduled to close mid Nov.....all in expenses came to roughly $87k.

Sales price - closing costs/concessions - all in expenses = $20k profit split 50/50.  So I am happy to say that despite the complications along the way we were still able to pull close to $10k each from the deal despite taking 7 months to complete it all.  

Looking forward to the next deal & hoping to cut total time from purchase to sale from 7 months to 3 months.