All Forum Posts by: Diego Ortega

@Ellis San Jose

The rent would be anywhere from $1400-$1600 according to the agent and what I've seen.

Hi,

I recently flipped my first home with my family and it just went on sale! I feel like I have understood many of the concepts talked about on this website except for one. That is the Buy, Rehab, Refinance, and Repeat strategy. It sounds amazing when explained but I'm having trouble envisioning it in my current first home. What I mean is, can someone with experience, use my numbers as an example to show me if it would be worth looking into for my first property? It's only been on sale a little over a week, but maybe it's better to rent it out? We did 90% of the work ourselves.

Original loan: $129,500.

Monthly Mortgage: $955

Rehab Costs: $25,000

Current Price for Sale: $240,000 (Not yet appraised, so could be a little lower maybe)

My main questions are will BRRR work in this example? How do I pull money out and keep the property as a rental? It's a normal mortgage and I had only put down 3.5%. Is it still worth and possible to do BRRR? Wouldn't my mortgage payments go up if I refinanced and took out the extra value added money at 70%?

This is all new to me so trying to to take it all in and not miss anything. Here is a link to a video tour of the property if anyone is interested:

https://www.youtube.com/watch?v=M7iN21U6AbU

Thanks!

@Account Closed Thanks! I will for sure share the numbers once it is sold. I'll be happy just to make a small profit, but the agent thinks it will be a fair amount.

Hey guys! Quick update I posted on this flip in the success stories category:

First Flip in Ferndale, MI

So tomorrow our first flip will go up for sale! It's been a long 7 months, but a valuable hands on learning experience. Excited to see how the market reacts. I'm counting this a success already just for working up the courage to do it after creeping on the biggerpockets site and leaning a ton. Before I show the before and after pics, a little background on why I decided to do this with my family.

I went to school for Industrial Design and work in the auto industry mostly. Ever since graduating, I've always dreamed of owning a nice modern home or even renting one. I soon realized that "luxury lifestyle" look only tended to be possible if you were buying or renting an almost half million dollar home or loft. I felt like a lot of young professionals wanted that, but couldn't afford it. So after living in the area for so long and getting a good feel for where that demographic might want to live, I settled on Ferndale. I love the city and it's constantly growing/welcoming small local businesses. It's nightlife is also amazing with plans to expand the downtown with more lofts, etc. I'm also a designer by heart and wanted a chance to be creative while also investing. I teamed up with my father and mother. I handle the designing and contract work with my dad (he's amazing at his craft) and my mom loves decorating. Our thought was "worst case scenario, we own a house we would be proud of". So we dove right in and I'm hoping it will do well in the market. It will be up for sale in the next day or so. I'll share the numbers and how well or not so well it does when it's sold.

Now, on to the pics and video! We did pretty much everything ourselves and saved a ton of money that way. We thought that was important for the first one. For the next there are some parts we would contract out to speed up the process. The stress was real, but worth it at the end. It's a 3 bed 1 bath near downtown with an open concept and lots of custom designs. Very modern. We worked with what we had and think we achieved something special.

Before:

As for After, I feel a video is a little more fun: 

Video Tour on Youtube!

Hope the goal was achieved, but I will keep you guys updated on how it goes. A little nervous, but glad we finally started investing.  I'll post some after pics too this week.

Cheers,

Diego

@Carson M. I'm not quite ready yet, but will be soon after the sale. Maybe in March?

@Matt Souza Thanks! About one more week and it should be complete and I can start taking photos and shooting the video. Then my agent can put it up for sale.

Let me ask you guys a question. What is your take on the very modern houses popping up in the area? They are either new or all remodeled. This is the niche i'm going for because I love modern/hip design and seems to be getting big in Ferndale. They look like loft/house hybrids. I have seen them sell for well above what is expected of the area. I'm assuming they are selling because of the young professionals and the night life in the area.

Thank you, @Richard Ball

@Mark Nolan Thank you! I've been creeping on the blogs for a while, haha. 

@Eric La Pratt

The house is on Horton and Woodward Heights. It's a 3 bed, 1 bath and about 1300 sqft. The main goal is to use this property to get started. We are doing all the work ourselves and I went for a full modern conversion with custom designed work. It includes a modern deck, stone entertainment wall, a wood wrapped column, an open glass shower, wood ceiling hallway, and soon...a modern white high gloss kitchen. 

I'd like to cater to professionals who always wanted to own a modern loft/houzz.com home, but can't afford anything over $300k and up. At least that is what I have noticed in the immediate areas. I believe Ferndale is a place that fits that demographic as it gets more and more popular. I am one of those professionals that always wanted this and never found it.

The property was purchased for $124K, and according to where the budget is heading, the total costs spent, including holding, fixed, and materials/labor will be at around 35k. So to recover and break even we would have to get about 170k. After the agent saw the work, she thinks we can get around 200k. We'll see. The money my father and I get back from this and profit would be used to purchase more homes and this time my dad would be able to work on it full time. We've learned a lot so far. I'll keep you guys updated!

Hi guys,

My name is Diego and I recently just started my first flip in Ferndale, MI. I graduated with a major in Industrial Design and currently work in the field of creative advertising. While I love my career, I've always dreamed of designing homes that look amazing. My father being an amazing craftsmen with an eye for detail, we've decided to team up and flip houses. The allure of financial freedom being a strong one, but so is design. I want to wow people when they walk into our homes.

I just bought my first flip and closed June 2016. It's in my favorite city, Ferndale! Hoping to have the project finished sometime in Feb 2017. It's the first one so we are doing it in our spare time. When it's complete I will share a video and pictures. Excited to finally join the community after reading/listening to many podcasts and purchasing the flip book! Hoping to turn this into a business that doesn't feel like work to me.

Cheers,

Diego