Condo Flip #1 in Edina, @ the Edina West Community.
An amateur investor and I began discussing purchasing a flip in mid 2015. I have been trying to create solid relationships with investors for sometime, and quite truthfully, money guys don't usually take chances on 3rd year real estate agents, why should they?
I noticed that another agent at my office had done a flip in a condo community close to my office, he's a veteran, selling $50-100+million in real estate a year, every year.
I asked him if he would mentor my flip processes, from research, to offer, to negotiations, to bidding out contractors, to designing, staging, the whole way through... not only did he say yes, but, he also said he was proud of me for taking the initiative and that he was glad to help me. His $/hour is worth a lot of money, so he was doing non-money making activities sitting down with me, the several times he did, and for this I will always be grateful and appreciative. What I know now, most successful people like seeing others become successful, in a sense, that's what the 'BiggerPockets' community is... we just have to ask for the advise & coaching, but, I digress.
So I would have meeting with him, put my plans in front of him, he'd say do this, do that, don't do that, this will get you in trouble, etc. I always ask for advice when it comes to financial matters I've never dealt with, that keeps me from f'ing up, and since I wasn't using MY MONEY 100%, it was important that I do everything to cover my partner's @ss. I feel a tremendous amount of gratitude when people put faith in me and I always do everything in my power to make them proud of choosing me, sorry I'm digressing again.
I found a top floor unit, with attractive vaulted ceilings, listed for $159,000. I threw a low ball offer and kept on him, it was dated, it was an estate sale, the owner had passed on recently. I got them to come down to $135,000 because my mentor advised me: "you need to make your profits on the buy to secure the profits on the sell," he also kept repeating, "you don't need to buy this, you don't need it, you can walk away, try and keep the price low."
After we came to terms I proceeded to find the necessary people to carry out the rehab and updates.
- Demo
- Knocking down & opening walls
- Building new walls
- Electrical
- Tiling
- Flooring
- Carpet
- Paint
- Cabinetry
- Design
- Staging
- New trim
- New doors
- New appliances
- New kitchen & bathroom
- Etc.
It turned out beautifully and I was able to create the highest $/sqft the community has ever seen.
My second flip project of 2015 was due to one of my contractors leaving the deck door open, a pipe froze and exploded, and flooded (destroyed) the unit below me, I will discuss that project in another post.
Overall, I'm very happy with how the results came, I learned a tremendous amount, especially about myself, money can be used as a tool to generate more money, I can understand real estate flipping, and I'm responsible with an investors money in my hands, I can manage a project properly, I can hold contractors accountable for their mistakes, etc. I grew tremendously through this project and it has given me the courage to move onto more.
Thanks for reading.
