Investment Info:
Single-family residence fix & flip investment.
Purchase price: $185,000
Cash invested: $55,000
Sale price: $274,000
2 bed, 1.5 bath home with 2 large Living Areas, open concept layout for entertaining, large open kitchen with stainless appliances, a 2 car attached garage, and remodeled kitchen and bathrooms. All new windows throughout, refinished wood floors, new interior and exterior paint, new garage and front door, new plumbing, new deck, and lots of natural light! Home is nestled on a large corner lot with mature trees in a great neighborhood in Oklahoma City.
What made you interested in investing in this type of deal?
I was initially interested in this type of deal (Fix & Flip) because I had wanted to get involved in real estate investing for a while, but hadn't found the right conditions to enter until I moved to Oklahoma City from D.C. and realized the potential in this city for growth. I went to an open house nearby and was under contract on this one within a week of moving to the city. I finished in just over 3 months, and while I went over budget a bit, I learned some invaluable lessons for my next flip!
How did you find this deal and how did you negotiate it?
I went to an Open House nearby and ran into the realtor who was talking up the property I ended up buying off-market. We went to take a look and I realized how much potential this property had, especially within the surrounding neighborhood. I ended up offering cash slightly less than what the seller was asking, but since it was off-market and there was other interest, AND because I saw it as a good deal as it was, we ended up with going with the asking price.
How did you finance this deal?
We used cash on this property
How did you add value to the deal?
We completely renovated the kitchen, both bathrooms, re-finished the hardwood floors, poured a new concrete driveway, re-built the back deck, stained, painted, etc. and tons of other small projects throughout. The finished product really brought the house up to modern standards and re-vitalized a great home that just needed some love.
What was the outcome?
The outcome was a beautifully renovated house that appealed to a modern buyer with the new finishes and color schemes, etc. but that's also timeless and neutral enough to allow the purchaser to put their own touches in and add their own flare to make it theirs.
Lessons learned? Challenges?
The main lesson learned was that while hiring a General Contractor definitely sped up the process and streamlined the work (as opposed to me finding my own subs for each specialty / project, etc. and dealing with everyone individually), it definitely cost more and the budget ballooned more than I had planned (and I DID plan for some of that!) They were good contractors, they didn't try to weasel me, but they're also in business to make money, and that became VERY apparent as we went forward.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
This was my first flip and I found it through an agent (word of mouth marketing basically), so we used her to buy it. In terms of deciding to use an agent to sell it vs. going "for sale by owner," I decided to use the same realtor because I wanted to make sure the house was marketed as well as it could be and sold as fast as possible. In the future I will have my license and will be able to do that work myself and keep those commissions, which DO get expensive and definitely cut into our profit.
