Completed flip in San Fernando, CA

[Will Barnard]

Purchased off market for approximately $50k-$70K below fair market value. Gutted interior and reformatted floor plan to include true master with ensuite bath, new hall bath location, added interior laundry and dry bar plus new HVAC, new roof, new electrical panel and whole house rewire, new kitchen, flooring, paint, landscaping, etc. Sold with multiple over ask price offers inside of 1 week. Final result was an ~$85k profit for a <6 month flip. A private investor loan from my private investor network was used for the acquisition plus a small amount of the rehab, balance of the cash came from me. The most difficult part about these types of flips is dealing with the city for permits and inspections. This particular one was NOT with LA building and safety (thank goodness) so it went much faster and smoother, hence getting in and out in just under 6 months instead of probably 9+.

I typically have been doing much higher end projects where the exit values are at or above $2M but this deal was brought to me by an agent friend whom I have know since I was 18. The sellers were the older kids of Mom who passed away and the home was an absolute wreck inside and out. Teal blue paint on exterior stucco, roaches crawling around the kitchen in broad daylight, pet (and probably human) urine and other foul odors in the home, etc. This created a great buying opportunity and the agent intended to list for $539k knowing he would have gotten over ask price for it just because the market is so hot here. I told the agent and his buyers that $500k was the most I could pay but I would make the offer without any contingencies, all cash (with bank statement POF) and close quickly. After a day pondering their options, the agent came back to me with the good news that they just wanted to dump it and felt comfortable with the guaranteed close, so the deal was mine. I immediately engaged my architect team to do their job and started on the plans while in escrow. Getting this jump start is how I lower my hold times which save holding costs and increases the profit margin.