Live and flip. First time and it has turned out AMAZING!

[Justin Phillips]

Investment Info:

Single-family residence fix & flip investment in Durham.

Purchase price: $171,000
Cash invested: $23,000

In 2020 we decided to move across the country (UT -> NC) to attend graduate school at Duke! We were sick and tired of paying rent during college, so we bought a home! The only thing we could afford definitely needed some work, but we knew we would end with something beautiful and pulled the trigger. First home, first flip.

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

A friend of ours recommended a realtor she knew from church, so we reached out and she was an absolute God-send! We connected with her in March 2020 and when travel and many in person viewings shut down we couldn't even go out to tour any houses! (Not that we could have afforded it anyway) That's when we realized it was so key to have a person you trusted, who is familiar with the area & market, on your team.

How did you finance this deal?

We were able to use an FHA loan to finance this deal with 3.5% down. In fact, an inspection of the home revealed damage in the crawl space that we used to negotiate the seller taking care of much of the closing costs! We were about maxed out on what we could handle as a monthly payment, but we had put in very little cash of our own.

How did you add value to the deal?

We fixed everything we could! We just started with our inspection list and fixed those things. That included the crawlspace structure items we hired out, new paint in the whole house, new flooring in the kitchen, laundry, and all the bathrooms, new carpet in the bedrooms, subfloor in the kitchen, new front and back doors, removing a wall in the kitchen, painting cabinets, new countertop and backsplash, refinishing the deck, and all the little odds and ends that just don't make sense.

What was the outcome?

Last month this home appraised for DOUBLE what we paid for it! We refinanced to get cash out and are looking to do another one, this time with more resources.

Lessons learned? Challenges?

In terms of projects, we learned a little about a LOT! Some of the main challenges were the kitchen subfloor, that was tough (and unknown until we were living there!), we also found an important beam when we did the kitchen wall demo. That forced us to reevaluate the plan/design we were shooting for, pivot, and make it happen.

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

I highly recommend our real estate agent, DeLynda Cook, an absolute gem! She held our hand through so much of the process doing tons of video walkthroughs for us, teaching us how to fill out paperwork and what each item means, and even had her son mow our lawn while we were still traveling cross-country to get there!