Hi fellow BPers, I am a local rental property investor and fix-and-flipper here in New Jersey. I have a project in Englewood, NJ, that has taken a lot of time and work thus far to get sold. We bought the property end of January 2018, and thought it would be 6 months to get in-and-out. Rehab took about 2 months, and we had it listed by April. The property had multiple full offers first day and was under signed contract by May. We thought all was gravy, but you all know how you should never count your eggs before they hatch, especially in this business. After multiple appraisal disputes, and inspections, where we fixed up all the "issues" the buyer said were with the house, we thought we would close by June, latest July, and took the lower appraisal value after all, knowing we would still profit from it. Low and behold, a week before closing, the buyer said they couldn't secure the mortgage afterall, and would have to back out of the contract. Since this was FHA, their deposit was refundable, and we were back to square one.
After re-listing it in August, we had a few offers shortly after a few weeks and eventually got it under contract with another buyer, at the same price as we agreed with the first buyer on. This guy really wanted the house, and even though he was also FHA, we thought that everything would go fast and smoothly with this guy, especially since he said he didn't care about the appraisal or inspection, he just wanted the house. Of course, with the bank, they order both anyways, but we had no issues this time around, as we already priced it at the appraisal price and didn't have to worry about it renegotiating. All the points on the inspection were minor and were fixed. But the issue resides in getting this C.O. from this town. This town is notorious for being corrupt and not easy to work with, and we found out the hard way. The first time the inspector came, he said we didn't pull permits on certain work we did in the attic; when my GC when originally for the project to get permits for everything else, they said he didn't need it b/c he wasn't moving sheetrock. Then the second time the inspector came, he found a different problem, with the electrical wiring outside. Now today the inspector came there again and said all the smoke detectors have to be wired in, even though we found out from a buddy of mine that's a fire marshall in another town that that's not the case since this is a 1920's house that has been grandfathered in. I told my guys just to do whatever they have to do to make them happy so we can get the C.O. in-hand and finally close on this sale. I feel bad as the buyer has been waiting on us to move-in, and we have been just keeping him happy, as the last thing we need is another buyer to back-out and start from square 1. Hopefully we can get everything wired and fixed in the next day or so and have the inspector come out for the final (and hopefully last time) by Friday.
Long story short, do you other BPers have other similar situations and experiences you would like to share? Any regretful (but knowledgeable) flipping experiences that took way longer, more time & money than you thought? Thanks a bunch and I appreciate all the insight and knowledge I have learned on this site alone from fellow investors!
