2015 Progress Report

[Christopher Goldie]

So I wanted to post quarterly about my progress for this year to possibly inspire other newbies and receive pointers from the pros, and well I'm 30 days behind. So as April ends here is what I've accomplished thus far.

HUD wholesale deal fell apart at the last minute, so I let it go back to HUD, taking a loss of about $800. Earnest money and an extension.

Purchase a HUD property to rehab. Small 980 SF 2/1 in "lunch pail Joe" area. Purchased at $24,000 , $21,000 in repairs. I put 2 people together that funded the deal, one a family friend and another a guy I met working a part time job at a Marina last summer. I get 25% of net profits for providing some labor, but zero money out of pocket.

HUD wholesale deal #2, unable to wholesale, however the "mentor" I was working with decided to close the deal and rehab. I'll receive 20% of net profits at sale. In for $500 earnest money, expect $6-8k. Will be satisfied with that.

Closed HUD wholesale deals #3+4 in late March for a combined profit of $11k. Very pleased about that. One was a 3400 SF upscale move in ready home, other was an old 1300sf farmhouse on 2.2 acres in a rural area.

HUD wholesale deal #5. Missed calculated ARV, unable to move as a 2 bed 1 bath at my price. Aganist convential wisdom I am investing with my mother and youngest brother to purchase this house. Our plans are to convert a spare room into 3rd bed and do rent to own. All in after repairs at $41,000, ARV at $74,000 with rent at $700. Not too bad except having to split profits 3 ways. To be determined how investing with family works out.

Aganist advice from several people, I attempted a sub2 deal in the same neighborhood as my rehab, with a Realtor involved. House was on market for 300 days, way over priced. After talking with agent discovered owner couldn't afford making payments on this vacant house she bought for her son. Would have worked if agent wasn't stuck on his 6%. Not blaming him, but after almost a year on the market, come on. Still poking that one.

Started an official wholesale business with my brother. We've been marketing to a large variety of people including, absentee, high and lower equity, tired landlords etc. Calls have been trickling in. I've been handwriting or typing letters myself to our list with plans to use first deal profits to outsource. I spend what time I can driving for dollars after work searching for distressed and FSBO's. Working a full time job, not giving up much time with my daughter and doing all that is a strain, but I believe it will be worth it in short order.

Spent many hours meeting and talking with a private lender who is very selective about who he works with. End result, I have a solid funding source. If I agree to share profits with him, I can even get into deals with zero out of pocket. Super excited!

Placed a 1900sf ugly house that was poorly converted to a duplex under contract for $19,000 in a hot area in town a few weeks ago. Decided last night to back out and eat $500 earnest. Reasons are forthcoming in lessons learned.

Lessons learned- One block can have a huge impact on values. Wholesale deal 5 and contract property are perfect examples. Both houses are one block outside of the "hot" zone. In both cases there is a difference in value of about 30% in that short distance. Luckily my lender and several friendly investors pointed out my error. Don't just use a 1/2 mile radius for comps. Get out and drive the street and find actual comparables close to the subject properties.

Joined a local REIA and a deal makers session. The networking and contacts have been a blessing. So many great people from newbies to experienced pros. Plenty of doors opened up potentially leading to many deals, partnerships and coaching partners.

Some goals yet to achieve, purchase a property with creative finance method, at least 3 more rehabs and one more rental.

I think the rest of 2015 is going to be awesome! Everyday making a good step towards my goal of quitting my job and financial freedom. Will report back at the end of this quarter ( or shortly thereafter)