Jumped in Right Before the Crash

[Heather Elizondo]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $45,000
Cash invested: $15,000
Sale price: $78,000

Bought my first investment in 2007, listed late in 2007, title issues forced me to hold it until 2008, POOF! giant market crash and house sells for $25k less than first listed. Lessons learned: start work at the title company so you don't invest time and money in something that's not able to be sold, hire out jobs that force your hourly wage below your current day-job wage (even if you enjoy doing the work), keep the flip quality and investment in line with the neighborhood.

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

Financial desire to build wealth through real estate. Intrinsic desire to see progress.

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

Purchased from a family member.

How did you add value to the deal?

Stripped to the studs and refinished/rebuilt all surfaces, fixtures, and functional parts of the house.

What was the outcome?

Eventually sold after legal issues cleared.
Laid off investing until I had time to research and know what I was doing. I am now a licensed Realtor for several years, and I know the market extremely well.

Lessons learned? Challenges?

Lessons learned: start work at the title company so you don't invest time and money in something that's not able to be sold, hire out jobs that force your hourly wage below your current day-job wage (even if you enjoy doing the work), keep the flip quality and investment in line with the neighborhood.
Challenges: Lack of available money for repairs and work made it necessary for us to do it ourselves.
We should never have taken on that kind of a project without knowing the business.