Getting a Taste for Flipping

[Kevin DeBoer]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $295,000
Cash invested: $11,000
Sale price: $409,900

My wife and I didn't have many options purchasing our second home. The price of real estate was sky rocketing and we knew we needed to get in the market. We had been looking for homes and nothing felt quite right until we walked into this house covered in cat hair with purple and pink kitchen cabinets, bright green receptacle covers, etc. We ended up purchasing and utilized the home as our primary residence as we self-funded the improvements.

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

At the time it was our only way into the market and I knew adding value to the home was going to take a lot of sweat equity but cost very little.

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

Not much had to be negotiated. The house was in such bad shape that even though competition was pushing up sales prices of homes in the area this one wasn't impacted.

How did you finance this deal?

We had made some money on a previous real estate investment that we were able to use as a down payment on a conventional mortgage.

How did you add value to the deal?

Started with deep cleaning and painting which turned the house around pretty quickly. From there we renovated the bathroom with a new shower/tub, new vanity and new floor. I took out a wall separating the kitchen from the living space to open up the floor plan and put a concrete counter on some new custom cabinets. We created more storage down low in order to remove some upper cabinets. Lastly, we refinished the hardwood floors and painted the old brick fireplace white.

What was the outcome?

Night and day. A house that used to feel cold and dark had life and light.

Lessons learned? Challenges?

I kick myself realizing if we would've sold a couple months later we probably could've made 10-20% more on it. Going into Covid lockdowns we originally thought we sold at the best possible time, but prices just went up from there!

The house had some old cast iron piping and older electrical panels and distribution. Figuring out how to work with those items with modern day building materials and strategies took some brainstorming.