Latest Flip in Montgomery Alabama

[Peter Philando]

Investment Info:

Single-family residence fix & flip investment in Montgomery.

Purchase price: $50,000
Cash invested: $23,994
Sale price: $135,000

This was a very challenging project. I had to fire one contractor who was just all talk and no action. He knew how to do the work but was a poor business owner which showed up as bad money management, among other things. I also had to fire the listing realtor because she did not do her part and was not straightforward when deal did not close.

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

I am predominantly a buy/hold investor but decided to flip this one because of how hot the market was

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

My contractor was looking at it for another buyer but there were some plumbing issues that the buyer was not comfortable with. The buyer was a realtor so he told her that I buy houses. My offer included paying for all closing costs and close in 2 weeks. I also wanted to use the realtor when it was time to sell

How did you finance this deal?

It was a cash purchase and use my own funds for rehab

How did you add value to the deal?

The main work was to gut both bathrooms and create a 3rd master suite. I kept the kitchen cabinets and appliances, but replaced the countertop and added the peel/stick ledger stone backsplash. Painted throughout and refinished wood floors. On the exterior, removed all the overgrown bushes from the front and back, cut 2 small trees in front, planted some sod, power wash exterior of the house, and added mulch and solar lights.

What was the outcome?

I listed at $130K and took a cash offer for $125K but the buyers could not close at the end. I fired the realtor/agent because she was negligent in her duties. I relisted using flatfee.com for $175 and took a full-price offer for $135K. I was meticulous in communicating with the title company and buyers' agent to a successful close.

Lessons learned? Challenges?

In a hot market like this, I will not use a listing agent and save myself the 3%. Most agents are just using access to the MLS as their main strength and don't really work to market and sell your property. Well, there are ways to list on the MLS without hiring a listing agent. You have to put in a bit more work but on higher-priced sales, it's definitely worth the extra effort.

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

NO