All Forum Posts by: Account Closed

Single-family residence fix & flip investment.

Purchase price: $148,000
Cash invested: $10,000

3/2 Structure is good, cosmetic only. Kitchen and both bathrooms will need update. Option to add small bedroom in basement. Full flooring, paint and doors needed.

What made you interested in investing in this type of deal?

Lack of availability. Qualified for conventional. Material prices were high, avoided any major projects.

How did you find this deal and how did you negotiate it?

Appraised above asking price. Offered 2k less due to sanitary conditions.

How did you finance this deal?

Conventional

How did you add value to the deal?

In progress

What was the outcome?

In progress

Lessons learned? Challenges?

While doing the pre purchase walk some plastic cartridges were found in the cabinets. Looked like a kids toy.
I now know what roach traps look like.

I have landed in an interesting spot that could have some great outcomes. 

We purchased a twin home to flip and 8 months in the owner next door has yet to be seen. There has been snow on the driveway for 2 months with no tracks. A main concern that we have is -10 outside, and no one checking the place. 

The owner paid cash, only person on title and has passed away. 

I really don't want this thing hitting the market and selling for cheap as that would screw up my comps. The value move in ready should be about 200k, but in its current condition would sell for much less on probate.

The only option I see is to purchase. Have found someone to put up the cash. I feel very comfortable with the risks associated with HML, and find it very ideal to own my first rental home in direct proximity.

Have spoke with the county, has not hit probate yet. Finding family has not been easy as they have very common names. 

How do I get an offer put in?

How do I take the emotion out of the situation, yet still empathize while throwing a lowball offer out if someone can be located?

What's the best way to find contact information for what seems to be an estranged family? 

I'm too far in to give up now, but feel like I've exhausted all my ideas. 

Any thoughts would be greatly appreciated!

J.Scott has a great book on Flipping Houses. Within it there's tables laid out for every item, age and condition.  

I run a filter on realtor.com and check for recently sold. Throw the numbers into the tables on a spreadsheet for finding the ARV and compare the move-in ready vs flip ready. I have a really complex borderline OCD method of doing comps but I'm sure there's an easier way out there.

Avoid any zillow estimates. Once you have your own system in place, your own numbers will be more reliable. 

15k is some serious progress! What's one more year?

There's some apps out there - Hipcamp(com) 3 acres could make a few rental camp spots, give the kids some learning experience mowing grass and building value. $20-30 a night just to let random townies sleep in your yard with their own stuff. Plus the storage income from the pole barn, and get some experience managing property for income. Not that I've fantasized about owning land at all...

Even if you don't do this deal, there are plenty of other ways to play.

I am not fully experienced in real estate enough to give you anymore then just an opinion here. 

Lack of assets, equity and just recovering from a paycheck to paycheck habit is concerning to jump into a hard lender.

Distressed properties are already someone else's headache. Mobile homes are a completely separate added string of problems. Is 100k ARV the price of just the mobile home, or the 3 acres with a barn and a mobile home?

What does your sale potential look like? If it is truly a great investment why is it still for sale?

I hope it doesn't sound like I'm trying to talk you out of this. learning to budget is huge, and opens up opportunities like this. My lack of trust is in a financial institution that would back this loan without considering all the pitfalls and potentials you are about to find. 

Best of luck! Mobile homes are a great option to keep expenses low while preparing for the next move. Identify and prepare for the headaches before they happen.

Those poor musicians. Having to choose between conformity and expression, making someone else rich or exploring their artistic direction. 

I feel much better deciding if I should buy gray paint, or grey paint to match my white trim and wood grain LVP.

@Brad Holcman

I have always wondered what the hell happened in these homes before I end up with them? 

Seeing the combination on intentional stupidity, complete disregard for taking care of anything, borderline mental health issues, and overall neglectful care of the own well being leads to their home ending up on a TV show. Catching them on camera whining about how some greasy "investor" screwed them out of their perfect move-in ready home would be a plus. 

Unfortunately I feel that the people who revolve their lives around reality TV are the same ones selling me their home. 

The reality in house flipping is pretty dull, it's mostly just work. You could probably catch a lot of drama following married blue collar couples that do live-in flips. Those are some real moments. 

We have a 3/2 twinhome with a single bedroom and a large storage room in the basement. We have plans to add a small kitchenette (hookups close, wasted space + kept old appliances from kitchen remod) and turn the storage room into a finished office/closet or storage space. 

If we eliminate the storage space, we could open up the entire wall for cabinets with counter space next to the washer and dryer, and the remainder of the space would be living room. 

However, if we were to relocate and double the size of storage room on the opposite end, it would be just barely large enough (80 sqft) to be considered a legal bedroom. 

Would the added bedroom increase our sale price, or would the lack of storage space decrease the potential desirability?

Top photo is kitchenette area and storage, bottom is possible bedroom. 

Fun fact: The original carpet (top) looks way better then it smelled. 

Additional Q: keep the brick wall original, paint, or remove?

Thanks in advance!

I use Sherwin for paint but I use my employers bulk pricing and just pay cash. It's about 50% off per gallon if not more, and they keep track of my colors. If it weren't for the discount, nope. 

Shopping around has its benefits, personally I avoid Lowes and HD. We have Menards up here and they are basically the Walmart of hardware stores. The class of homes we flip are aimed at first time home owners on a budget, and they had an 11% rebate for the last 2 years. 

So I think it depends on your style and situation. I work multihousing and only do about one project at a time for myself. Someone else is paying me to shop around and make connections, but due to a corporate structure they get stuck in certain aspects where everything has to be large volume from reputable dealers. 

There's pallet jockeys that can pick up a few thousand feet of a manufacturers discontinued flooring and resell for a third of the price, or other open box materials. 

Some stores can win on one project but nail you on the back half with the hardware or other materials, which is where Amazon comes in. 

If the numbers work to stay with one supplier, and the gamble on maybe saving a few bucks isn't worth the effort then by all means do what works best. 

Lately it seems I don't shop for price, I shop for who can it here faster...

"We want inclusion, diversity and culture here" Can also mean:

"We want inclusion, diversity and culture, but if it shows up in our neighborhood we will band together an HOA, hike property taxes, confine everyone that doesn't look, act, earn, think or smell like us to lower income disadvantaged areas, then collect federal funds for an electric bus route to connect our neighborhood to our high paying jobs"

Stripping names off an application is a start, won't change much and isn't hurting anyone. There are issues going much deeper that will not go away until we can openly discuss and point out unintentional wrongful actions and the negative stereotypes and behaviors without offending or being offended.

It's just much easier to just blame it on the white, poor, ignorant and blue collar and still wonder why things wont change.