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Updated over 3 years ago,
Clean Cobbs Creek Flip
Investment Info:
Single-family residence fix & flip investment in Phila.
Purchase price: $135,000
Cash invested: $60,000
Sale price: $255,000
This property was in fantastic rental shape as is, but my investor decided to flip it. The house had new drywall, recessed lighting, a rental grade bathroom upstairs, laminate floors, and clean ductwork. My investor was going to finish the basement, add 1 1/2 baths to the property, and redo the kitchen.
What made you interested in investing in this type of deal?
My investor loved this deal because of the area, cobbs creek has been absolutely blowing up in recent years, with rehabs going on on nearly every block.
How did you find this deal and how did you negotiate it?
This deal was sourced through New Western Acquisitions and was sold on a first come first serve basis.
How did you finance this deal?
This deal was purchased in cash.
How did you add value to the deal?
My investor is adding value but finishing the basement, adding 1 1/2 bathrooms, redoing the existing bathroom and the kitchen.
What was the outcome?
The outcome is going to be a great rehabbed west philly home. This area is exploding with DOM averaging around 30 days, some as low as under a week on market. On top of that most hot properties are getting into bidding wars with your closing price far exceeding the asking price.
Lessons learned? Challenges?
The biggest challenge for this project was showing my investor the value of the area. A year ago your entry price to Cobbs Creek was anywhere from 80-110k, while your ARV values hovered at 210-225k at the top. In the current market your entry price has shifted to 110-135k while your ARV values have increased to 230-255k on the right blocks. This change was something my investor did not realize, when he originaly thought he overpaid for the property, but he did not consider the increased ARV.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Dan Powers - New Western Acquisitions
