Primary residence turned fix-n-flip

[Aaron Malejko]

Investment Info:

Single-family residence fix & flip investment in Canon City.

Purchase price: $193,900

Rancher Built 1971. 3 bedrooms, 2 bath with large garage on corner lot.

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

This was more than we wanted to spend but the market was just starting to heat up. We needed a bigger place with a big garage because we accumulate tools and needed places to park trailers. We knew we wanted to do more home remodeling and this was straight out of a 1970s museum of homes. Glittery popcorn ceiling, wood paneling, seahorses on the blue bathroom tiles.

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

Watching the MLSs and scouting the area on bicycles! We passed on this house once, it went under contract, fell though and we decided it could work. First day back on the market it was us and another offer. Both full price but we were Conventional financing, they were FHA. I told them I'd do my own inspection, deal-breaker items only and offered to let them leave all the left overs from their estate sale in the garage and I'd deal with it.

How did you finance this deal?

Conventional 3% down. I used my buyer's agent commission for down payment, earnest money covered other closing costs. Only had to bring $80 to closing.

How did you add value to the deal?

So far only solar panels and remodeled two bedrooms. Replaced water heater with tankless. Need to remodel the rest of the house, probably replace roof, exterior paint and re-pour sidewalks.

What was the outcome?

Property values have increased drastically for this type of property. Once remodeling is done, I anticipate it will sell for $135K more than we initially paid, so we have plenty of room to invest money into upgrades.

Lessons learned? Challenges?

I don't know how many times I should have learned this by now, but it is very difficult to live in and remodel the same house.

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

Not on this deal.