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Updated about 4 years ago,
My first house/house hack and sale
Investment Info:
Single-family residence fix & flip investment in Pasadena.
Purchase price: $130,000
Cash invested: $125,000
Sale price: $389,900
This was my first home I purchased for me to live in. It was a major fixer upper. I used a conventional rehab loan, and some private equity to help finish the rehab. It took me almost 11 months to finish the project but once moved in. Once the house was done, I did a cash-out refinance and pulled out 90k in cash to pay back the private equity. I house hacked and rented out the other two other bedrooms almost my entire time in the house. I sold the property this year and netted $122k on sale.
What made you interested in investing in this type of deal?
This was my first house that I used to help build equity, and propel myself into my next home I love in now. It's allowed me to grow equity and cash which I will use to invest in true rentals and other opportunities.
How did you find this deal and how did you negotiate it?
I found this house online and used a realtor to acquire it. The home was a foreclosure.
How did you finance this deal?
I used a conventional rehab loan.
How did you add value to the deal?
I ended up gutting the house and re-doing everything. New windows, siding, roof, plumbing, electric, HVAC, new well drilled, everything interior/exterior was new.
What was the outcome?
Even though this was my personal house I lived in for 4 years, once I sold it I made a good chunk of cash I used to help buy the next house.
Lessons learned? Challenges?
It was a big challenge. Originally I did not plan on gutting the house, but once I got into it, the house was in such bad shape I really had no other choice. I ended up needing to borrow more money, and I worked on the house almost everyday in the evenings and weekends to get it done. As challenging as the process was, I learned a ton and it really turned out to be a great first deal for me. (Even though I did live in it for 4 years) selling with no cap gains at the end was fantastic though :)
