Investment Info:
Single-family residence fix & flip investment in Tukwila.
Purchase price: $135,000
Cash invested: $30,000
Sale price: $260,000
1939 bungalow 2BR/1BA on 1/3 acre with three apple trees, four plum trees, one cherry tree as well as red and white grapes, plus a 300 sf outbuilding.
What made you interested in investing in this type of deal?
At first, I just wanted a home in Seattle area. Then realized I could live in it and fix it up. It was only later when I needed to sell that I realized I had a lot of value-add equity.
How did you find this deal and how did you negotiate it?
My boss at the time told me about this house that was (weird or not) across the street from her house. Fortunately we were really good friends so it wasn't as odd as it might seem to live across the street from your boss.
How did you finance this deal?
conventional loan and personal out-of-pocket to pay for reno. I didn't know it at the time but I guess it turned out to be a house-hack.
How did you add value to the deal?
Landscape: beautiful, already a selling point for anyone. Exterior: new paint, gutters. Interior: all new windows, new paint and carpet; gutted kitchen, knocked down wall, new appliances, doubled cabinet space; gutted bathroom; added french doors to one BR and doubled closet space in both; added stairs to connect upstairs to downstairs, previously had to go outside to go downstairs; basement was totally redone with new office, family room, laundry room and storage. Some concrete work was needed.
What was the outcome?
Cute little bungalow with double the square footage. Brand new kitchen, bath and windows. I put in a great big kitchen window that looked out over the back yard onto all the fruit trees and the creek at the edge of the property. Perfect for coffee, meals, relaxing.
Lessons learned? Challenges?
Take your time planning & executing. You've got time since you're living in it. Get a feel for the house. Determine what the house really needs. Make it organic, nothing out of place. Always add usable space not only for you but for future owners. If possible, always check the property before you close. Went to look at the house day before close. Upstairs washing machine hose leaked, flooded basement. A $5 hose caused about $3000 damage that the sellers had to pay for (NOT us!).
