First deal - abandoned foreclosure flip!

[Travis Smith]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $165,000
Cash invested: $47,000
Sale price: $317,000

This was my first deal. It was an abandoned foreclosure in bad shape. I spent 15 months cleaning, repairing, and rehabbing it, and then sold it at the peak of the market before rates started to climb.

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

Reading the foreclosures chapter in a real estate book...

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

I looked on my county foreclosure website and saw this one up for auction the very next morning! I researched the property on the assessor page and the listed owner on Facebook to make sure I knew what I was getting myself into. I went to the bank the next morning to get a cashier's check and then went to the courthouse to at least watch the auction. I ended up bidding against a few others and bought my first deal!

How did you finance this deal?

All cash since it was a foreclosure at a sheriff's auction.

How did you add value to the deal?

It was an abandoned property in bad shape. The kitchen was a complete gut job, the bathrooms were rehabbed, real wood floors were refinished, new carpet on stairs and second floor, new paint everywhere, and many fixes to plumbing and drywall.

What was the outcome?

After staging, this house had multiple offers for above asking price. Sold about a week after listing and only a single open house.

Lessons learned? Challenges?

This was my first deal, so I learned a lot! I now have a comprehensive list of people to call for anything. I also realized it's much easier to tackle one room at a time (rather than one sub at a time, e.g. drywall). I stalled out and the flip took much longer than it should have because I wasn't motivated enough - once I gave myself a goal and deadline to list the house for sale I was able to break it down into smaller goals and move quickly.

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

Kyle Van Winkle with RE/MAX Concepts was super helpful throughout the entire process. I highly recommend him and his team!
https://www.remax.com/real-estate-agents/kyle-van-winkle-ames-ia/101918045