Wellesley Fix & Hold

[William Ladd]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $808,000
Cash invested: $124,000
Sale price: $1,100,000

This house was slowly rehabbed over a few years because we bought it right before the market crashed. We did mostly cosmetic updates, tiling the bathrooms but not changing the plumbing layout. The kitchen cabinets were all wood but an old style so we flipped the doors around and painted the cabinets to give them a modern look. Swapped the deck railings from wood to a modern DIY railing. Biggest expense was re-finishing the basement.

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

We were able to buy it with no money down. The seller was family and the house had fallen into disrepair and the basement had recently flooded. They wanted $625k for the house as is and didn't want to bother with a broker's fee or people coming through. We listed the sale price as $808k and got a no-doc loan for 80%. The buyer got their $625k and we used the extra $21k to pay for closing costs for both parties, fees and some outstanding bills on the house.

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

Family knew I was a flipper and when they were interested in selling they approached me.

How did you finance this deal?

No doc loan with Coutrywide Mortgage for 80% of the purchase price. We listed the other 20% as a tax free "gift."

How did you add value to the deal?

Minor updates and let it appreciate over time.

What was the outcome?

We walked away with a big payday at the end. We used the profits to buy and rehab a large farmhouse that my family loved and we moved into.

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

No real estate professionals were involved in this deal on either end.