1st Flip! Dellwood Ave - Commercially zoned SFR

[Ian Brown]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $38,000
Cash invested: $35,000
Sale price: $125,000

SFR property with excess land, zoned commercial, bank owned, without of area residential agent, 5 minutes from my primary residence

$38k purchase price, had money loan (Marshall Reddick) at 90% LV, brokered on my behalf (saved 3%), and renovated with a blend of savings, and credit lines from HD, Lowes, and Lumber Liquidators

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

Low $/SF in my own zip code with good comps and reasonable scope of rehab for new investor

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

MLS - Bank owned and commercially zoned. Resi agent didn't seem to understand the multiple exit strategies the zoning presented - could sell or refi/rent to resi or commercial tenant.

How did you finance this deal?

$38k purchase price, had money loan (Marshall Reddick) at 90% LV, brokered on my behalf (saved 3%), and renovated with a blend of savings, and credit lines from HD, Lowes, and Lumber Liquidators

How did you add value to the deal?

Full rehab/flip including new septic system, roof, and structural repairs to foundation

What was the outcome?

$55k profit which was 1031'd into 8 Unit C-Class Apt

Lessons learned? Challenges?

This deal took almost all of my cash on hand and was initially terrifying.

Ultimately, the fear of regret was stronger than the fear of failure.

Totally underestimated the scope/cost of rehab, but luckily I left a large margin/contingency in this 1st deal

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

Brokered on my own behalf