Investment Info:
Single-family residence fix & flip investment in Aurora.
Purchase price: $250,000
Cash invested: $27,000
4b/2b bi-level in Aurora, CO. I approached the investment with the BRRRR strategy in mind and then with a rent by room strategy. This changed from that to just rent to one family to selling it. The financial situation of my partner changed frequently and my full time work was getting in the way of making the right phone calls to get this done as a rent by room investment. This turned into a flip in the end.
What made you interested in investing in this type of deal?
My partner lives in that area of Aurora and knew the market. I also did due diligence to figure out comps and spoke with my network to see what a "deal" looked like. It was at a discount to market rate and that made it attractive. It did need lots of updating.
How did you find this deal and how did you negotiate it?
My partner built a website with google ad words. We received multiple leads on there and followed up with them. We negotiated directly with the seller. We got a property inspection which helped us negotiate.
How did you finance this deal?
Hard money loan @ 10% IR 10% down
How did you add value to the deal?
Redid the flooring, paint, gutters and electrical.
What was the outcome?
Unfortunately we had to sell the property. We are set to close on 4/3 and should make around 15k each for the flip. This is not the best return I was looking for but a great learning experience.
Lessons learned? Challenges?
The coordination of insurance, water, electrical and contractors were the most time consuming parts. It was disjointed since my partner took care of parts of it while I took care of the rest. Next time, I'd like to be more in control of that situation and know exactly what's getting worked on and when.
ALWAYS HAVE MULTIPLE EXIT STRATEGIES. Luckily on this one I did account for if we had to sell the property versus rent. Unforseen events always happen. All you can do is roll with the punches
