Flipping During COVID-19

[Gabriel Graumann]

Investment Info:

Single-family residence fix & flip investment in Everett.

Purchase price: $375,000
Cash invested: $77,500
Sale price: $520,000

First Whole Family House Flip

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

My brother and father were looking for a fix & flip opportunity close to where they lived and this house was within 3 miles for each of them.

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

Property was listed on the MLS. Multiple bid situation with a review date, so I offered an all cash, quick closing, and a bit over asking price if the seller accepted the offer prior to the review date.

How did you finance this deal?

My father, brother and I partnered to pay cash for the acquisition and renovation budget.

How did you add value to the deal?

Full renovation of interiors, plus new roof & paint on exterior.

What was the outcome?

Property came to market at the start of the Washington state "stay home" order due to COVID-19, yet we had numerous tours in person and virtual, ultimately selling at $520,000. Total net profit for the capital invested was 7.5% which was below our target, yet all things considered on the timing of the resale, we were happy with the outcome for my brother's first deal.

Lessons learned? Challenges?

Due to our quick turn-around on the flip, which was under 50 days for a full renovation, the property did not qualify for FHA financing as the property hadn't passed the 90 day market between our recording as the new owner and the time we came back to market. We had interest from buyers at a higher price if we would agree to take it off-market and/or hold the property for them, but we opted to adjust the price and sell it as the uncertainty of the stay home order impacted near term sales.

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

I acted as the listing broker. Utilized BKCO Title & Escrow work at a flat fee of $800 and provide exceptional service. Conducted a pre-inspection through WIN Home Inspections.