My first live in flip, 1 year thoughts.....

[Caleb Brown]

Hello! You might have seen me post replies on the forums but I wanted to share my first deal.

Intro... Everyone is always curious how did you get in Real Estate? I graduated High School early and got my license. Fast forward 4 years after that I have been blessed to be a top producer and was finally ready to buy a house. I started looking October of 2021. In the middle of all of this too I was getting ready to propose . During that time the market was crazy. Originally I had been targeting turn key and move in ready home in a C/B suburb outside KC. The first few offers I made were beat out. 

The home I bought... Now to the fun part. With being an agent I always look at homes that pop up everyday. One popped up in Independence. From photos it looked like a straight forward home that was outdated. Was built in the 60s so not super old. Both bathrooms had pink/blue tile (retro from the 60/70s lol). Carpet was dirty and gross and exterior needed painted/landscaping. They listed it for 210K, I offered 220K to lock it up. Normal contingencies. Financing wise I went conventional 5% down. Went forward and closed at the 220K end of November in 2021, "As Is" it appraised for 224K (whoop 4K bonus).

Mistakes/lessons learned.... There was definitely many mistakes I made. You might ask how could make mistakes you after you've helped numerous clients close. Well, I rushed the purchase and was anxious to get a house and be done with looking for one. The first piece of advise that I learned was DO NOT RUSH. Obviously it applies to Real Estate but in general don't put the cart before the horse. When you are looking for a deal you don't want to be a tire kicker but don't buy a deal for the sake of getting one. Do your due diligence and have everything needed to minimize issues/mistakes. Another piece of advise I would give is get multiple bids prior to closing and in the inspection period.  As I said before this house needed rehab. I severely under estimated how much and how long it would take. I did not get any GC's out there (rookie mistake). Both bathrooms had to be gutted and redone. I am not handy nor want to learn how to be. One example the bathrooms costed 3x more than I guessed/assumed (also had to replace most of the plumbing underneath the house). If I had received multiple bids and done more due diligence I could have negotiated, prepped or walked away. Also another advise I learned is rehabs will take longer then expected. I bought the house in November and it took 6 months to move in. There was a mix of reasons but be prepared if there is a delay or issue with rehabs. Most likely you will always uncover a surprise and that issue will need to be dealt with. One last advice I'd give is you will always learn something in a deal. I would say the issues came because I assumed I knew the answer. The outcome would have been different if I used the support team around me. Always find an answer regarding a real estate deal, don't wait post closing.

Outcome.... At the start I hated the house BUT I am thankful. It has taught me a lot. It has also worked out. With doing updates and it being in a nice neighborhood it is worth 280-300K so I have 100K in equity to tap into. Originally I was going to flip but with being married and just having a kid all in 2022 I plan to pull a HELOC instead. I still have more projects to do but it is very close to being done. Once it is done I'll pivot and further use the equity to invest. If you bought a turd or you are having issues with a deal keep trucking along. Don't put your head in the sand as it won't go away. Hope this helps :)