First Flip in Tacoma WA

[Kristel Daugherty]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $195,000
Cash invested: $30,000
Sale price: $330,000

Tiny 546sf 2 bedroom / 1 bath home on .17 acre that needed cosmetic updates.

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

It was a small project that we felt would be a great way to gauge if we wanted to do this again or not! If it didn't work, then it was small enough to not be too burdensome. It felt very achievable compared to the idea of a first flip on a 2000+ sf home that would potentially be much more work, longer to complete, etc.

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

Local wholesaler list that was just overlooked. We double-checked the numbers and found more opportunity than was advertised.

How did you finance this deal?

Private money for the purchase and our own funds for the remodel.

Our initial budget was $27k and we only went slightly over at about $30k. Our initial timeline was too ambitious and doubled from 6 weeks to 3 months. That ended up benefitting us by allowing us to accept FHA and VA offers too.

How did you add value to the deal?

We gave the whole house a full refresh, including interior and exterior paint, flooring, updated kitchen and bath, and a new deck. The back and side yards were overgrown with blackberries - so those were cleared and new sod was laid over most of the backyard.

What was the outcome?

Overall a net profit of about $85k!

Lessons learned? Challenges?

Supply chain issues and delivery delays caused some of the problems. We learned a few good lessons about the order of operations (we put flooring in a bit too soon). Always get the crawlspace cleaned up and re-insulated (this cause the appraiser to call out additional items which delayed closing).

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

Connect with folks at REAPS - this is where I got many of my connections to make this deal possible!