All Forum Posts by: Lee Badragan

 That's very interesting insight... I was always dying to go to an auction to see what kind of deals are out there, but am also intimidated at the idea of going head to head with the pros who have experienced teams backing them. I'm content playing it safe as I continue to learn and build savings for future deals. Thanks for that information! I consider it very valuable. 

I didn't have any inside track... the house actually sat on the market for weeks. :) I tried to get a mortgage on it first and the financing fell through due to the condition as shown in the appraisal. Then as I was dragging my feet working on getting a HELOC on my house, it went under contract (was kicking myself), then it came back on the market and I made a cash offer and got it.

And you're right that I spent a ton of time on it but like I said, that's part of my education. That's why I'm spending time here on BP as well. I look at the time I spent (and spend now) as an investment that will pay dividends on future deals.

Well I consider myself very lucky and blessed then. I would not even try to do a flip for a potential profit of only 15-30k. The risk for me would be too high due to my relative lack of knowledge and skill in this area. I can understand why it may make sense to pros who can flip in high volume and make up for the what I consider low margins, but it wouldn't make sense for me given that I'm inexperienced and have a job that keeps me very busy. I'll always be on the lookout for home run deals and if/when another one come along, I'll swing again. :) 

And I should probably clarify that I was referencing the original builder above... the house was built in the 1950's but the sewer issue was discovered before I bought it, when the neighbor had plumbing issues and discovered that the sewer line from the house I bought was connected to his sewer instead of running out to the street sewer. 

Thank you. My good friend is an agent so I asked him to set up a daily search for all new listings within half-mile from my house. I figured I'd start with in my neighborhood since I thought I'd be able to estimate value better than in neighborhoods that I wasn't as familiar with. I then went to Redfin and marked each one that was within my reach (based on my budget) as a favorite so that I can watch how quickly they sell and for how much, and to estimate how much was invested on the ones that looked like flips. I studied my neighborhood like this for 9-12 months before I decided to buy the house I did. So I was pretty confident that it was a fantastic deal. It was bank-owned, and I took out a HELOC so I can pay cash. Luck was on my side as well. It had a huge hole in the basement and needed a new sewer (10k), which I'm sure kept many investors away. The builder tied the sewer into the house next door instead of running it out to connect to the city sewer, so that was a violation that needed to be fixed. First thing I did was have a new overhead sewer installed. And as I mentioned above, I got lucky that the local market really rose as my contractor dragged his feet completing the work.

I did not track my hours, but I spent A LOT of hours before I bought and also while I held it. I didn't do any of the real work of rehabbing (very busy with my day job), other than frequent visits to the house and clean-up, but it was hard work getting educated about all construction stuff and design to do a good job on making it an attractive house for buyers. For me, the enormous amount of time I spent on it wasn't really a burden... I look at it as getting educated while being paid at the same time. I know that everything I learned will help me in the future on other deals. It helped that the house is literally on the same house as the house I live in, so even though I was very busy with my regular job, it was easy walking over to the flip house whenever necessary. I still drive by it almost every day. :)

Hello all,

I live just outside the city of Chicago, and have always loved the idea of investing in RE. I bought my first house (to live in) in 2009, and finally did my first flip this year. 

I do my best to live below my means so that I can take advantage of investing opportunities when they present themselves. I know the motto "measure twice, cut once". When it comes to RE investing, I adopted but modified the motto for myself to "measure 100 times before I buy" :) I'm VERY careful and will only buy if it looks like a "no brainer" with a big margin of safety in case things go really bad. Needless to say, it's very rare that I see something that looks like an attractive deal to me.

So I'm here to learn from the pros, be on the lookout for any great deals, and try to contribute based on my very limited knowledge and experience. 

I've enjoyed browsing around the forums and the blog... thanks everyone for your contributions!

My first flip - bought a house in '13 for 84k and sold it this year for 235k. Due to my inexperience with contractors and trusting them too much, it took me almost a year to flip it due to endless delays. In the end, the delays worked in my favor because the market in Chicago shot up during that time. When accounting for rehab costs and holding costs (used a HELOC on my house to buy it), I cleared about 75k in profit.

I joined BP to pick up tips from the pros, but it looks like I got very lucky on my first one and probably shouldn't expect to do another deal like that anytime soon.