Investment Info:
Single-family residence fix & flip investment.
Purchase price: $68,100
Cash invested: $35,000
Sale price: $170,000
Bought a dilapidated foreclosure. Renovated the basics of the house into a livable unit in the first month and moved into the house as our primary residence. We then rented our original primary residence out (also in Spokane) cash flowing 400 dollars a month on the original primary residence. We then renovated the house as time allowed before selling in 2015.
What made you interested in investing in this type of deal?
Necessity. We didn't have enough cash to purchase and flip houses, not even a down payment.
How did you find this deal and how did you negotiate it?
We found this house through homepath.com it was a bank foreclosure and we used an agent on our end to facilitate the deal.
How did you finance this deal?
We were able to utilize our local credit union to give us a Heloc to buy the house. You heard that right, our CU used the assessed value of the house and was able to fund it with a 90% LTV ratio. They obviously had a lot of trust in us personally.
How did you add value to the deal?
I did most of the renovation myself and subbed out specific tasks that I wasn't familiar with (sheet rocking the house for example).
What was the outcome?
We made a significant profit
Lessons learned? Challenges?
I grew up renovating houses with my father so I knew most of the challenges walking into the house after my own personal inspection, but what I learned is to be more cognizant of how much damage water can do while the surface still looks adequate. The shower in particular in this specific house had rotted out the sub-floor and one of the floor supports that wasn't visible due to the unique nature of the crawl space being compartmentalize due to numerous home additions in this specific house.
