Hi there! I'm an investor from Brockton, MA and I wanted to share some details about my first foray into house flipping. I currently own and rent a condo and have equity in a 4-unit commercial building with my father (we also run a restaurant in one of the units). Last year, my father sold a rental he owned, and that I managed (it was a foreclosure that we rehabbed then rented) and I'm borrowing money from him to fund my first solo project.
My agent found me a great deal, a short sale, that I put an offer in back in September 2015. The bank ordered a BPO (Broker Price Opinion) earlier this year and countered my offer with $10,000 more and a $5,000 buyer contribution towards closing, which I agreed to (even at this price it was still a great deal) and a new P&S was signed. The BPO has since expired (good for 60 days) since the bank seems to be dragging their feet, so they now have to order another BPO. It's been almost 3 weeks and I'm still waiting to hear back from the bank about scheduling the new BPO. Needless to say I've been super patient throughout this process since it's a great deal and has tremendous upside potential. Hopefully it will close soon so we can get started.
This will be a cash purchase and I'll be getting a short term loan and a line of credit (should I need it) from a regional bank which will fund the rehab. I'll be doing the following during the project to add value: second floor addition for 2 new bedrooms and full bathroom; slight change in kitchen/dining/living layout for open floor plan; new kitchen and new bathroom; finish basement, gas furnace, update laundry room; landscaping in the front and backyard. There a few more items but these are the major points. Contractors are in place (using the GC that rehabbed my father's rental) and have already spoken to the City to see if anything additional will be needed outside of standard permitting.
I've been reading J Scott's book on flipping and it's been a insightful resource. When we're ready to sell we'll be staging the house and making the open house an experience. Since my dad and I own a restaurant (and he's the Chef) we'll provide some light bites during the open house to add to the experience. I really prefer to call it a redevelopment than a flip. In my city, flippers have a not-so-good name because a few flippers in the area have been known to cut corners and do crappy jobs (putting lipstick on a pig).
Looking forward to my first solo project and I'm still learning along the way and always open to suggestions and plan on having a few more bumps in the road. I've always wanted to delve deeper into real estate and read book after book but never pulled the trigger. Now that I'm in a much better place I have no more excuses so, this is it! Wish me luck and looking forward to reading some feedback from the community!
