Our first fix and flip

[Jonathan Carpenter]

Investment Info:

Single-family residence fix & flip investment in Whitefish.

Purchase price: $267,000
Cash invested: $150,000
Sale price: $525,000

Purchased from online auction with minimal investigation.

Home was being used as a drug house prior to our purchase. Rooms were added all over the place, HVAC was ducted improperly to heat parts of the garage. The place was just a disgusting mess.

The basement was completely full of mold due to power going out and no operational sump pumps, the list goes on.

Able to fully remediate basement mold, strip out ad hoc interior walls, completely renovate the property including landscaping.

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

We were interested in finding deals we could fix and flip due to television shows when we were younger. Finding this property with massive mold issues was the perfect fit for us and our company.

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

Found this deal at a garage sale. Neighbor told us it was going to auction, we found it online and won at an online auction.

How did you finance this deal?

Private equity partner for a portion of the purchase price, the remainder of financing was with a hard money lender in the area. All renovations were cash flowed personally through leveraging our business. We really didn't have any idea what we were doing on this as far as the financing went. We were lucky honestly.

How did you add value to the deal?

We spent 10 months and $150,000 on the home to repair all the damages and bring it up to speed as a luxury home.

What was the outcome?

We were in a multiple offer situation. Had the home listed for $475,000, sold for $525,000 before renovations were even complete.

Lessons learned? Challenges?

We learned to have ALL your financing figured out! Sheesh, what a nightmare!