I flipped over this mill house!

[Julie Miller]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $121,000
Cash invested: $114,000
Sale price: $330,000

This was my first fix & flip! After running my numbers and taking the dive...I was told by GC's that I paid too much and that the renovations would be at least $150,000on this 1910 mill house. Charlotte, NC is a VERY hot market, this house is across the street from a new hospital, the town hall/police, and a few blocks from downtown, the Catawba River where a boat launch is available. We got more than our asking price and made $95,000 profit after recouping all of our costs.

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

A hot seller's market determined that this would be a fix & flip.

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

This was a FSBO on Zillow! Don't be afraid to look there and speak with the seller. We negotiated down the asking price and created a great rapport with her from the opening sentence. I left her a voicemail saying, "I'm sure that you're getting 10,000 calls about your property, and I love this house!. I'm *name* and willing to offer you cash, quick closing, and no repairs needed" (and left my number). She called me right back and the rest is history... and I kept every word.

How did you finance this deal?

I used my own funds, but I would not do that again. Ever. Use other people's money to finance purchase and repairs.

How did you add value to the deal?

We added a bedroom (by building a single wall) and a jack & jill bathroom. Prior to renovations, the only bathrooms were in bedrooms. This new bathroom allowed for guests to have a bathroom to enter from the living room. We chose beautiful granite countertops, but installed kitchen cabinets purchased from Lowe's.

What was the outcome?

The selling price was more than our asking price! I want to mention here that our buyer used NACA as the lender. Sellers and flippers, be very aware than there are many requirements for a NACA purchase that I understood as strict requirements. We underwent a number of inspections, revised repair requests, and so on. However, even though NACA is said to not negotiate by reducing the price vs. making repairs, during the process I learned that a seller can simply say "no" to repair requests.

Lessons learned? Challenges?

I would NOT use personal funds again to purchase a property and renovate. Also, using this particular example/experience, I would recommend that you visit your property often to supervise the contractors. If you can't make it to the property, have them send pics of the work that they have completed BEFORE they seal it up with tile, drywall, etc. Also, concentrate on building good relationships with all parties involved. They become your team. Teamwork makes the dream work.

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

High Performance Real Estate Agency in Charlotte, NC. This agency held an open house on a Saturday and by the next evening, we were under contract! Great to work with. Rather than having one realtor who does EVERYTHING from marketing, to open houses, to paperwork, to showings, to contracts, to closings...they use a TEAM concept. Everyone does a certain part of the entire transaction, and you always know who is assigned, they keep in contact with the seller when any task completed. GREAT!