First Flip with my friend gone poorly.

[Corbin Hicks]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $188,000
Cash invested: $58,000
Sale price: $269,900

First Flip with my friend gone poorly. I think it’s good to be transparent and have some humility. This flip went poorly across the board. Everything you could think of that is poorly prepared and executed happened. Mix in some bad luck and bad relationships involved & we get this flip. Ended up actually taking a small loss on this but many good valuable lessons learned from it. I never want something like this to happen again I’ll push to be more surgical with my fix&flip projects ahead.

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

The property seemed like it had good potential had a reasonable price for a flip.

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

My friend presented it to me and wanted to partner up on it.

How did you finance this deal?

Hard money loan. Went 50/50 with my partner.

How did you add value to the deal?

Ended up renovating this house completely. Did way more work than expected.

What was the outcome?

First time taking a loss on a flip.

Lessons learned? Challenges?

It's a tough pill to swallow. A few of many lessons learned though; don't use general contractors that are just recommended by people (actually get a feel of their work long term). If using a gc, then get very specific on what work is being done (they especially can get you on "misc" charges & not do any real misc work), get a better spread to begin with Don't be a great house in a not so great neighborhood.
Lastly, I have my RE license now so some of the issues on that end will work better.