First out of state flip

[Stacee Evans]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $67,000
Cash invested: $95,000
Sale price: $229,000

This Texas flip happened while living and California because of Biggerpockets.com and specifically starting with reading Long-Distance Real Estate Investing by David Green and 90 Days of Intention Journal by Brandon Turner. My purchase price was $67,000 and the rehab was $95,000 and it sold for $228,000. You have the details, but keep reading if you want to hear more. I had to give the buyer $8000 credit for some of the rehab that was not up to par. I was going to do a hard money loan, but ended up paying "cash" at the last minute. I borrowed some money from my 401k, used some credit cards with a 0% interest for 18 months and 3% fee and borrowed some money short term from a friend at 5.99% interest. I had the usual holding costs such as utilities, insurance, tax, lawn care and cleaning, but for my first flip I'd say it was successful. There were some bumps in the road, especially towards the end of the rehab and the buyer was backing out until the day before it closed, but in the end it all worked out. I looked into renting it out when I thought the sale wasn't going through so I also learned a lot in that process. I went through a wholesaler to find the deal that told me the rehab would be $95k and it would sell for $210k. He also said he'd help me anytime. The rehab was right on and the selling price was more! He checked in on me on a regular basis and when I asked for advice from him, he gave me great advice and on more than one occasion went to the house to check on it and give me updates and even sent me pictures and videos. He clearly went above and beyond and finding someone that competent is key. My realtor that sold it on the back end was also fantastic and had excellent communication skills and knowledge when multiple issues came up. I used the resources on BP to build a team and get referrals. I really had to go through quite a few flaky people before finding mostly a good team. I found this property through a contractor that wanted the job that found out about it through a wholesaler. This contractor had looked at other houses I was considering and steered me away from the bad ones. This one was a burn house and needed a major rehab. I think the only part of the house that wasn't damaged was the brick fireplace. I decided to do a small flip for my firsts out of state, but the numbers never seemed to work so why not start with practically rebuilding a house? The good part is nothing can come up once you open the walls that are not there. I purchased it before seeing it (because I lost a couple deals) and then set up 4 interviews with my top pick contractors. I had my fiance (who is a handyman) fly out and interview the contractors and chose the one that referred me the deal. He was working on other projects in the neighborhood so he was able to see those. I would say after tons of researching, analysis, the one thing that made me pull the trigger was my mastermind group that BP put me with after purchasing the 30 days of intention journal. They just kept hounding me, having me define my goals and asking what actions I'm taking this week. Wow, that was powerful. We are no longer together but the bi-weekly calls and accountability helped me get this going. The first set of photos are before and last set after. I currently own rentals in California and Nevada, invest in elder care and memory care homes I'm now moving on to out of state buy and holds.

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

I decided to just invest in something different and new. I spent quote a bit of time researching how to flip.

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

I purchase this through a wholesaler. The numbers worked, so I just paid his asking price.

How did you finance this deal?

I financed with a 401k loan, credit card advances (0% interest and 3% fee) and personal loan.

How did you add value to the deal?

My contractor did a complete rehab.

What was the outcome?

This was sold through a realtor and I had a nice profit as well as learning quite a bit.

Lessons learned? Challenges?

I learned the team of people that you work with is key. There can always be unexpected challenges but that should actually be expected.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I highly recommend my realtor, Sharon Tzib if you need a good realtor in the Houston, TX area.