Live in Flip and Rental - Aiken, SC

[John Harmon]

Investment Info:

Single-family residence buy & hold investment in Aiken.

Purchase price: $108,000
Cash invested: $23,000

3Br, 1.5 bath SFR

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

We wanted a property we could remodel to add value. We have done renovations in each home we've lived in, so the idea of a live-in flip that we would turn into a rental made sense for us.

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

My realtor knew what type of property we would be looking for, and that it was about time for us to buy another house. He brought this deal to us before it hit the market. We were able to speak directly to the seller about the house, but negotiated through the realtor. We offered about $3k over what he was asking, but got $5k in seller concessions, which reduced the amount of cash we needed at closing.

How did you finance this deal?

This was a conventional mortgage with 5% down.

How did you add value to the deal?

We literally touched everything from floor to ceiling in this house. We installed LVP before moving in, replaced all light fixtures, plugs and switches. We refinished the cabinets, added new countertops, sinks, and faucets, and added a built-in storage bench in the kitchen. The main bathroom got a new tub with subway tile that matched the kitchen backsplash. We also had the roof replaced and the ceilings smoothed, which were the 2 jobs we hired out.

What was the outcome?

We originally planned to rent this for $1,100/month when we started. After finishing, our PM listed it for $1,250/month and had it filled within 2 weeks. The estimated current value is $140k - $150k.

Lessons learned? Challenges?

The biggest lesson from this deal is to be very clear about your expectations with contractors. When we had the ceilings refinished, the subs had to come back 3 times to get the job done right, and I still ended up doing some touch up work after they left. This could have been avoided if the contractor and I had worked up a more detailed SOW in the beginning.

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

Josh Cline was my realtor(we've done 5 transactions together so far, and he's always been great). Matt Hunter was my lender, with this being 1 of 3 transactions he's we've done together.