Investment Info:
Single-family residence fix & flip investment.
Purchase price: $115,000
Cash invested: $120,000
Sale price: $249,000
Surprises. We found a problem with the foundation at the back of the house, which meant added work. We found weak studs, so reinforcement was needed, so off with all the plaster, and new sheetrock. One surprise was easy: we wanted to remove the chimney and use a ductless water heater, replacing an oil furnace. The brick chimney was so deteriorated that it virtually imploded with hardly a tap of a hammer.
What made you interested in investing in this type of deal?
The asking price was so low, and we all know that 'you make money on the purchase', so we thought this was a winner.
Ultimately we made 10K+, so as our first flip, it was an education, and we did not lose money!
How did you find this deal and how did you negotiate it?
Wholesale deal from a guy I had met. We both own condos in the same complex (we each have 3 rental units in it)
How did you finance this deal?
Cash from HELOC
How did you add value to the deal?
The clean-out was incredible. Prior owner had passed, and was a hoarder. Garage sale, Craig's List, many trips to the dump, many weekly pick-ups by the city, donations to charity...and a few items we took home.
What was the outcome?
finally, when it was ready to show, it sold quickly. By then, we just wanted out, so we took it.
Lessons learned? Challenges?
Don't buy in a flood zone. We did, and even though it had never flooded, any bank required flood insurance for the buyer. Many were scared away. Also: Time- The city permit process was really slow, which delayed the work at every step, ultimately months. So, we could not put it on the market until September.
