Magnificent May in Arizona

[Shiloh Lundahl]

Last month I wrote a post on the success that we had as a team in April and I called it Awesome April in Arizona!

This month I wanted to detail some of the success that we had in May and call it Magnificent May in Arizona.  Next month, I will need a cool word that starts with the letter "J" to go with June.

Anyway, the month of May was also a great month for us. We closed on the purchase of a really old house in a historic district in Mesa, Arizona. It is a 2400 square foot house on half-an-acre. It has tall ceilings an some really cool features to it. We purchased it for 220k and our estimated ARV is about 360k conservatively (there is a good comp at 400k). We plan on putting 70-80k into the rehab. Let me know if you know any contractors in Arizona that restore historic homes that do a great job for a decent price because we are looking for one.

We purchased one house at the auction that we are going to fix up and turn into another lease option in Coolidge, Arizona to add to our other 2 down there that are lease optioned. 

We purchased another house that used to be a mobile home that was added on to until it became a 2400 square foot home on 2 acres in Queen Creek, Arizona. We are converting it into an SFR with the city since the majority of the property is not a mobile. The purchase price was 112k and the repairs are going to be about 100k and the ARV is about 300k. The cool thing with this one is that, because of our track record, one of our hard money lenders is going to fund the purchase and the repairs since the spread is so big and the ARV is so high. So we will have very little of our own money out of our pocket with this one.

We found someone who wanted to do a lease option for a property that we were getting ready to list on the market to flip in Apache Junction.  Even though we were going to flip it, we realized that the lease option route would produce a greater overall return and cash flow in the mean time (about $800 of cash flow a month split between my partner and I).  We partnered with an investor on this property who put in about 35k to help with the down payment and some of the rahab.  He has been able to learn our system of the finding, funding, and flipping (but in this case lease optioning) and has earned money while doing it.  So it has been a win win for everyone.

We have continued on the rehab with 2 other properties one of which will be a lease option and the other we are still deciding on whether to flip it or do a lease option for it.  

We got under contract for a flip in Phoenix for 235k. Estimated rehab is between 25k and 35k and the ARV is between 335 and 350k.

We also closed on a primary home in Burbank, California which will be a live-in-flip that we plan on adding 700 square feet to to increase the value from 800k to 1.1m.  And we plan on renting out the back guest house as a short term rental to bring in $1500 a month to lower the cost of our mortgage.

So we are almost to our goal of 10 buy and holds doing lease options this year.  Now we are ramping it up to attract other investors who want to learn how to flip properties in Arizona to work with us to help us reach our goal to flip 20 houses this year.

So May truly has been marvelous month for us in Arizona (and Burbank).