The Flip that Started it All

[Thomas Magill]

Investment Info:

Condo fix & flip investment in New York City.

Purchase price: $250,000
Cash invested: $15,000
Sale price: $472,500

I purchased this condo to live in with the anticipation of holding on to it for as long as possible. Things changed when I slowly started to fall out of love with NYC. I started the renovations of this live in flip shortly after the purchase, and worked on it after getting home from work and on the weekends. I did most of the work myself and hired a couple plumbers and electricians after shocking myself a couple times.

What made you interested in investing in this type of deal?

It was in the best area (in my opinion) of New York City... the West Village. I initially wanted to keep it forever, but once I made the decision to go out on my own, I knew I need to sell it in order to start my company. So, this went from a live in flip to hold, to a live in flip to sell.

How did you find this deal and how did you negotiate it?

I found it on streeteasy.com and then contacted an agent to help me with the purchase. This was my first individual purchase of a property. I'd purchased one before this but it was an investment property within a partnership.

How did you finance this deal?

Traditional financing with 20% down and a 30 yr mortgage. I'd never purchased anything this way before and this was in 2012 just when we were coming out of the financial crisis, so lending was very tight. I had to get a 'gift' from my mom to show 2 years of liquidity in an account, in addition to a bunch of other requirements.

How did you add value to the deal?

A lot of sweat equity. I bought 15k worth of materials, and did most of the work myself. I worked in construction at the time and received some after market or damaged materials from some of my subcontractors.

What was the outcome?

I lived in the property for about 5 years. I ended up selling to a news anchor off market who owned 2 other units on the first floor. She was fantastic to work with and made the process very easy for me. She then leased the property back to me until I found another place to live in North Carolina.

Lessons learned? Challenges?

The biggest lesson learned, which I still have issue with sometimes, is to hire professional to do the right work. I tried to do everything and after a couple shocks and some water damage I learned my lesson.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

No