My First Flip - Remotely done in Norther Arizona (near Sedona)

[Brian Larson]

**PICS COMING SHORTLY**

I just found this thread and figured I would post even though the rehab is complete and the property is listed. I have another just starting and will post in another thread.

Note: I live in Los Angeles area and am doing a remote flip. Due to J Scott's book and his podcast I decided to make sure the flip was with someone I could trust intrinsically and would care about the job as much as I do. Thus my birddog, estimator, GC, project manager and everything else is @Kyle Larson my brother who is local to the area. 

Purchase Details:

• REO listed on MLS. Started at $49k in January of 2014
• Put under contract for $28,000 in late June
• Closing delayed 2 months due to electric work needing completion (bank paid $4k to get new work complete)
• Closed on 9/17
• Purchase Price: $28,000 ($2k below our our target acquisition price)
• Paid cash, rehab costs out of my pocket as well to keep minimal holding costs (outside cost of money and opportunity cost)

House Details:

• Built 1985, 2 bed/2 bath, 950 sq ft on 1/8 acre lot near a creek and now defunct golf course
• House looks like its manufactured. Had to triple check it wasn't...it isn't :)
• Estimated Rehab was $13,500
• During inspection we found termite damage that would cost approximately $2K in tenting and repairs. Since we saved the $2k on acquisition we rolled with it
• Actual Rehab with termite was $15,500 (fantastic job on estimate by my brother on his first flip. Also thanks to J Scott's estimator worksheet
• Estimated ARV: We went conservative - $75k
• Currently listed (as of 10/17) for $87.5k

Rehab Details:

• Remove old carport and porch
• Rebuild and reface deck
• replace both Baths
• New flooring throughout
• Fix siding, paint exterior
• Drywall work, paint and baseboards throughout
• Heavy landscape cleanup, gravel, etc
• Appliances, cooling/heating and inside electrical were all good to go
• Kitchen could have used an update but was in good shape and at this price point was just right for the area.

So this is less of a diary than it is a summary but we still have to sell! I am excited at the possible profit and feel very good about turning the neighborhood eyesore into a nice home for a small family or older couple looking to retire by the creek. Win/Win/Win

Brian

[Brian Larson]

so this was not the best journal post ever...lots of huge gaps! Sorry about that.

First, there were some new windows put in. Most of the work was done by various handymen, nothing by myself outside of some cleaning, replace a door knob, etc.

So, with that, this is now closed and we did fairly well. Here are the details:

• See full details above for purchase price, date, rehab etc
• This area is very remote and thus had very low foot traffic (known going in)
• It is a stick built house BUT it looks like a mobile and no matter how much we advertised as such, we always got feedback that it looks like a trailer (BUT ITS NOT! :)
• Sold in March
• $70k purchase price
• $3k in concessions
• Buyer wanted to do a seller carry. I obliged
• 50% down, 5 year fully amortized

So the net of it is this. We did well. Definitely profit there BUT I will not see it immediately. I felt this was still worth taking on the note as the payments will catch up to the rest of my 'money in' by the end of the year. Now I have a nice income stream for the next 5 years. Not bad!

Overall this was a hit and I am very happy we did it. With that said, we learned a ton about the area, perceived value and the type of buyer at that price point. We fielded some very interesting offers :)

Again, J. Scott's book was hugely influential for @Kyle Larson to be able to estimate accurately. I would have never carried a note (or knew what that was) without this forum/podcast