My First Property Flip 16 months later

[Account Closed]

I just completed my first flip in Queens New York. It took me 16 months from the minute i close as a buyer to the minute i had close as a seller. Here are the numbers.

Purchase Price- $330K

Closing Cost as buyer-$1K

Renovation Cost- $105K 

Holding Cost- $18K

Misc Cost- $3k

Closing Cost as seller-$8K

Sales Price $475K

Net Profit- $10K

The experience I am about to share only applies to the New York Queens Market. Before I took on this property I want to disclose that I am a contractor and all the renovation work was done by me and my crew.

1. I had purchase the property at a city auction and I knew from the start it was going to be a full gut renovation from inside and outside. My budget to purchase this property was $300K but when your at the moment of bidding at an auction, as a rookie investor, I let my emotions get the best of me and went into a bidding war and won at $330K.

2. Being a contractor I estimated $80K renovation, the first 3 months starting I was 70% done with the inside and outside work. But then my electrician decided to take his third payment and disappear so I had to get another one and then to find out that the new meter i wanted outside and upgraded was going to take another 6-9 months for the electrical company and the city to complete and inspect. I estimated to finish this project in 3-4 months and now with another 6-9 months that would make it a year. This is how the NYC market operates and all because i wanted to upgrade the meter and relocated it outside with higher amp wires. The old meter was located inside and the wires were so thin that it would not support the electrical output of today's generation.

3. Finally after 12 months holding and winter came and gone, i was in the finishing stage of renovation, so to save some labor cost i decided to do the rest myself. That took another 2 months because I had to get it done part time so that i could fix some other personal family matters that i had no control of. I could had subcontracted to get it all done fast, but $450K already spend and I  didnt have enough to keep spending if i wanted to profit something and lucky holding cost wasn't much.

4. I did a for sale by owner and sold it to another buyer. We both didnt have any agents so that saved me 4-6% of the sale price but it didnt come easy. Doing a FSBO was very time consuming and it took 2 months to find the right buyer.

Conclusion: I cant wait to start my next flip, i was over confidence thinking that being a contractor I have some advantage but i didnt and in this NYC market it didnt matter because some things you just cant control.