Updated over 4 years ago on .
Live-in Flip in Alaska
Investment Info:
Single-family residence fix & flip investment.
Purchase price: $125,000
Cash invested: $25,000
Sale price: $355,000
I would consider this a live-in flip. Home was an owner build (basically a converted shop with 1 bedroom and 1 bathroom). My inlaws did a presale inspection and mentioned that I should look at it. The owners were elderly and leaving the state. I couldn't qualify for a conventional loan at the time because I had changed employment. I spoke with the daughter of the owners and asked if she would consider owner financing. She said "Possibly, with a large enough down." I asked what she had in mind and she responded with at least $20k." To house my family, I needed more rooms so I built a second storey on the ground. I hired a crane, lifted the roof, placed the pre-built second storey on top of the 1st and then set the roof on top. That cost me about $70k. Then I built a 40 x 60 shop with a 600sf apartment above and a 20'x 16' deck and added a hot tub under the deck. The shop, parking area, and landscaping cost about $100k. To refinance as a 5 bedroom, I had to put in a new septic system which cost about $15k We added a greenhouse and a lawn for another $5k. The buyers got a VA loan so EVERYTHING had to be fixed, including $5000 to an engineer to fix a cracked truss tail, $25k to replace 2 boilers
What made you interested in investing in this type of deal?
It was close to my inlaws. It had a large, wooded lot and was not visible from the street. It had a swamp/greenspace behind and a treed vacant lot on one side. It was very private and not as windy as most parts of Wasilla.
How did you find this deal and how did you negotiate it?
My Father-in-law did a presale inspection and I walked across the swamp and talked to the sellers in person.
How did you finance this deal?
Owner finance with a 5-year balloon.
How did you add value to the deal?
Added rooms, bathroom, new septic, lawn, greenhouse, shop, driveway.
What was the outcome?
Sold at a small profit
Lessons learned? Challenges?
The flow of the house is important to buyers. Also cosmetics are very very important.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Used Realtors: Betty Keener and Terry