Investment Info:
Mobile home fix & flip investment.
Purchase price: $8,500
Cash invested: $33,500
Sale price: $133,500
This was an interesting property and seemed a little “SCAM-ISH” from the get go but it was worth exploring. I found this property advertised on Craigslist for $10,000 and after reaching out to the nice gentlemen in south Florida that explained that he was helping a friend at a charity that received the property by donation, I thought this has to be legitimate….. It was about an hour away from my house so I decided to take a drive and check it out. When I arrived the property it was extremely overgrown and you couldn’t get to the back of the house. The house smelled and looked as if they were raising livestock in it and it was in worse shape than the gentlemen lead me to believe but what did I expect for the price. I called him on the way home and told him I was a lot worse than expected and he asked me to make him an offer…. I was good at $10k but since he offered I said I would do $7,500. We settled on $8,500 and I called my title lady and explained the situation and she had the same thoughts I did but said as long as title checks out we should be ok. She went to work and it turns out it was a legitimate deal. I bought the property for $8,500. After hours of bush-hogging I discovered a massive trash pile and the back of the house was melted due to them burning the trash to close to the house. Several months of work between a handy man and myself, three 30 yard dumpsters, and about $25k in total repairs I had it ready to rent. Once rented I did a re-fi and cashed out at $61k. I rented the property for a little over a year and a half at $1,250 a month. The downfall was that this property was in the middle of nowhere and when something came up o could never get someone to repair it in a timely manor. After several months of AC issues and not being able to get it fixed, I finally decided to sell the property. I had to make some minor cosmetic repairs and finally replace the AC unit and ended up selling it for $125,500! the contract price was $133,500 but we worked it out so the seller received $8,000 towards closing. This deal started off extremely risky but ended up being quite rewarding in the end.
What made you interested in investing in this type of deal?
It was a great price point and I only invest in mobile homes because of the opportunity.
How did you find this deal and how did you negotiate it?
I found this deal on Craigslist and negotiated via phone and email.
How did you finance this deal?
It was a cash deal.
How did you add value to the deal?
Most of the work was in the clean up. I also replaced flooring repaired drywall, new cabinets, tile bathrooms and new toilets and fixtures.
What was the outcome?
Great outcome! After renting it for a year and a half at $1,250 a month I turned roughly an $80k profit taking into consideration maintenance and holding.
Lessons learned? Challenges?
I learned a lot on this one. Somewhat risky but turned into a great reward. Always be cautious but curious.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
I am a licensed agent so I wrote my own deal.
