My flip so far...

[dwford]

I got into flipping I guess because I watched too many of those tv shows, and because I had quit my job and had nothing else to do. I started my house search in April, and was surprised how hard it was to find the right house. Well, I found the right house several times before a seller thought I had the right price!

Then came the closing. Why does it take 6+ weeks, and why is everyone huffing and puffing like you are asking them to run a marathon???? Shuffle the paper around people....

I finally closed on June 28, intending to be complete by August 5. Through a combination of my lack of knowledge/unrealistic expectations and a slow poke siding guy, I am still not complete as of today. It has definitely been a learning experience, and next flip I will probably cut the unnecessary trips to Home Depot in half - at least.

Here is my property so far. Siding is complete, but the siders haven't taken their scaffolding down yet. I haven't done any landscaping yet...

[brianb_cobbres]

Must have the numbers. This thread is useless without the numbers :scream:



And please update your profile so we can see where you are at.

[Debbie]

Looks real nice! Pat yourself on the back for making this a nice looking house and to take a giant leap in RE world!

I concur with Brian....

[dwford]

Some numbers from my project:

Purchase price: $170,000 - too high I know
ARV: $218,000

10% down, interest only note at 9%, no prepayment penalty

Expenses:

closing costs: $7000
rehab costs: $22,000
selling costs FSBO est.: $3000
total: $32,000

carrying costs: $1547/month

potential profit with full price offer: $16,000

I plan to have an open house on Aug 26+27

I am having a home inspection and an appraisal next week. I have everything from my previous home inspection complete,so there should be no issues. A similar cape about a mile away had an open house last week, listed for $224,900, and today the for sale sign was gone - could be a good sign. It had just been renovated also.

I ache, my hands a curled up in knots, but I have had so much fun, I can't wait for the next one. I only hope I can find a buyer soon, so I don't have to get a job.....

[brianb_cobbres]

The deals a bit skinny but sounds good if you can sell it fast. That monthly payment can really chew through your profits fast. Congrats and we want to see before and after pictures.

[dwford]

The only good point in the monthly pmt is that $400 is escrow. This deal won't make me rich, but it gets my feet wet and gives me some good subs for next time.

[Judd]

Edited

[dwford]

Pics are coming, want to get some of the major rooms finished, not just the bedrooms.

Got the kitchen almost done today - just have to bring in the fridge and range. What a pain installing the over the range micro was!!!! Installed the wall bracket just fine, but because of the low ceiling, we turned a regular 12" wall cabinet on it side to put above the range. I drilled the holes just fine, but when I went to put the bolts into the top of the micro, one of the brackets on the micro fell INSIDE!! I had to disassemble the micro to get the bracket out, then put it up. Hopefully the cabinet will still be on the wall tomorrow....

Installed the dishwasher also - electricuted myself. My hair is too short to stand up, so I just yelled and swore alot.

Tomorrow is D-day on the upstairs bathroom floor. I must have the tile layed by the end of the day. I have the home inspector and the appraiser scheduled for Wednesday afternoon. In between, I am going to see the real estate lawyer Tues afternoon, and a funeral Wed at noon.

And my landscaping isn't done yet.....
And my family is sick of helping....

[Debbie]

Pics are coming, want to get some of the major rooms finished, not just the bedrooms. AACCKKK! No before pictures????

Got the kitchen almost done today - just have to bring in the fridge and range. What a pain installing the over the range micro was!!!! Installed the wall bracket just fine, but because of the low ceiling, we turned a regular 12" wall cabinet on it side to put above the range. I drilled the holes just fine, but when I went to put the bolts into the top of the micro, one of the brackets on the micro fell INSIDE!! I had to disassemble the micro to get the bracket out, then put it up. Hopefully the cabinet will still be on the wall tomorrow....
We understand. Really, we do understand. We've had that happened not too long ago. In fact, what we did was, uh, um, hey Dwford--- is that your brackets on the floor?

Installed the dishwasher also - electricuted myself. My hair is too short to stand up, so I just yelled and swore alot. Was being electricuted fun!?!? Just wait til you're pregnant--boy, was that an experience you'll never, ever want to experience. Nor your unborn child! Luckily, my daughter didn't remember my rare cussed word...

Tomorrow is D-day on the upstairs bathroom floor. I must have the tile layed by the end of the day. I have the home inspector and the appraiser scheduled for Wednesday afternoon. Keeping fingers crossed for you! In between, I am going to see the real estate lawyer Tues afternoon, and a funeral Wed at noon. Oh Dwford! You should've known that pre-meditated murder is a no-no!

And my landscaping isn't done yet..... Just in case you didn't know---landscaping should be the last thing to do. Keeps the plants, grass and flowers fresh this way!
And my family is sick of helping....Never fails...it's a fact of life for all investors.


Good luck and we're still looking forward to seeing your before and after pics!

[dwford]

Thanks for the laughs Kaos.

The micro is still on the wall, getting electrocuted wasn't fun but not too bad. Got the bathroom floor installed today, using a tile cutter was easy, but I need to find something to cut tile with when you just need a notch. Got the downstairs bathroom pedastal sink installed also. Tomorrow the refrig and stove get put in, and I am putting both bathrooms back together. Got to have all systems running for Wednesday.

I put the house on Craigslist yeasterday, and got an email this morning. Am trying to set up a tour. Wish me luck...

[Greely]

Get a roto tool with a 3" disc for cutting tile. Comes in very handy.

[dwford]

Thanks for the tip, Greely.

Today was a hectic day. Called and cancelled the home inspection and the appraisal, the house just isn't ready yet. Got alot done though. Dug up 2 of the 2 bushes in the front yard (see photo), grouted the upstairs bathroom floor, fixed the downstairs bathroom sink, installed the hardware for both tubs, went to the lawyers, and got the fridge into the kitchen - by myself....

The fridge is 36" wide and 29 1/4" deep, guess which dimension was just a little to much... After I got it through the 29" wide door frame, I had to wedge it under the wall cabinet above, got it 1/2 way in before it started touching the cabinet, and was able to get it just far enough in to open the kitchen door to the outside. Hopefully the whole place isn't flooded - I left all the water lines open to my new plumbing jobs.

[dwford]

These are all "after" photos. My "before" shots for some reason all display upside down???

And I got 3 prospects this week, 2 from craigslist, 1 from Forsalebyowner.com

[Debbie]

The pics all looks great! That indicates that you have done very, very well on rehabbing!

I do have one concern though. If I may be bold---the bricks on the fireplace needs work. Do you have a plan for the fireplace?

[dwford]

I haven't done any cleaning yet, just daily construction clean up, so the bricks will get cleaned, the tubs/toilets also - yuck!!! Maybe I can con my mom.......

I talked to the prospect who called today, several times on the phone, in text messages and email, so hopefully they are a serious buyer. Said they have been looking for 3 months with a realtor - that concerns me. What takes so long?

[Bernie (WV)]

Love the hardwood floors or are the floors laminate?

Either way, looks good. I'm jellyous (jealous) :SM049:

[Burke]

I agree...it looks great!

Nice job!

[TommyOH]

The house looks great! I'm looking forward to you posting the sale. Good luck.

[dwford]

The floors are real even in the kitchen. Thanks for the compliments.

[dwford]

Here's another of the downstairs bath, the infamous yellow upstairs bath, the dining room, and the other upstairs bed room.

Had my first showing today - a buyer who saw the house on Forsalebyowner.com. Seemed to go well, wish me luck! I am asking 217,900, and a house right around the corner is under contract with an asking price of 214,900. It is a little smaller, but has a 1 car garage.

[Debbie]

Looks good!

I must admit, I'm not a fan of orange & yellow colors. I always hide hubby's bright orange Illini shirt that he eventually finds. Ugh! So I guess I'm saying that your yellow bathroom didn't pass my approval of your 1st flip... :scream:

Really.....you did well on your flip! Great job!

[dwford]

If the tile becomes a deal breaker, I'll be in there with a hammer for sure. Until then, I am looking to accessorize it by bringing in another color somehow.

I am going to have an open house this weekend 10-4 sat and sun. As soon as I get this one under contract, I will start looking for the next one.

[Aldo]

I love the floors and I don't care what they're made of. Everything else looks great, really great, but I love the look of wood floors most.

The yellow bath reminds me of a bathroom I once bought. I paid $200K for that bathroom and they threw in the rest of the property as incentive to buy it. lol

I'll swear to this on a stack of Bibles. (Oops! I meant non-denominational religious books. PC, you know.) I had the twin to your yellow toilet in the same bathroom that had a green bathtub/shower with a pink ceramic tile surround and, of course, a white sink. What were they thinking? Or, better, were they thinking at all?

[dwford]

Heeeeeyyyyyyy,

That almost sounds like a slam on my bathroom!!!:SM006:

I did go out of my way to find a matching toilet seat after all (but cheaped out on the $60 for a case of matching tiles to replace the 5 I broke). I think if I get a shower curtain to hide the yellow tub I can get away with it....

[Randy (SELA)]

Really nice job. Did you do the floors yourself? If so, post up some tips. I'm about to refinish some flooring in a couple of weeks.

[dwford]

Here's my tip on getting the floors done: PAY A PROFESSIONAL. I paid $1.30 per sq ft, he was done in 2 days and they look great. BTW, I only had the upstairs bedrooms and kitchen done. The others are original. Thanks for the compliments..

[Rich_in_CT]

Looking good! If you're looking for any new projects south of Hartford let me know, I'm in Bristol and can keep an eye open.

[Bluestarhomes]

Does anybody else have before and after pictures? I would love to see them!

[k6saunde]

If the tile becomes a deal breaker, I'll be in there with a hammer for sure. Until then, I am looking to accessorize it by bringing in another color somehow.

I am going to have an open house this weekend 10-4 sat and sun. As soon as I get this one under contract, I will start looking for the next one.

Why not save time and money? Just get it sprayed. That is unless you want to tear out the bathroom completely just to change the color of your tile?

:wink:

[AIR]

wow, I just read the whole thread, the flip looks incredible kinda hard to believe its your first one, hopefully if I ever do a flip it will turn out as nice as yours! Did you ever sell???

[Debbie]

wow, I just read the whole thread, the flip looks incredible kinda hard to believe its your first one, hopefully if I ever do a flip it will turn out as nice as yours! Did you ever sell???

Here's the recent postings from Dwford....
http://www.magicbullets.com/forum/showthread.php?t=5717

I'll send him a private email and have him come back....

[dwford]

I haven't left, just haven't posted in a while. Here's the update:

The house hasn't sold. In October I went back to work, and no longer had the time to market the house properly. Instead, I decided to try and sell my home, and move into my investment property. The logic being that I have much more equity in my home than in the investment house. At this point, with carrying costs and eventual closing costs, the house is a money loser by $3-5k.

Last month I optioned the investment house to an investor who does owner financing for people with bad credit but good incomes. When he gets a buyer lined up, he will pay me $209k for the house vs my asking price of $217k. He has had 2 open houses so far and has taken some credit apps. I have given him 30 days to find a buyer.

Lessons learned:

1. Don't over-renovate. My house is too nice, and you can get a livable house in the area for $10-20k less.
2. When no buyers bite, lower your price. I should have dropped my price after the 1st couple of weeks. Somewhere here I read the saying, "don't go for the last buck, go for the quick buck."
3. I need to get financing options lined up for potential buyers. Many of the people who toured the house liked it, but had little or no money for a downpayment.
4. Have money. I purchased and renovated this house based on the idea that I could flip it fast, and was willing to not work and finance it with credit cards. Now I have 2 mortgages and huge credit card bills. Basically every cent on my credit cards is attributable to either of my houses. Next house will be renovated with cash, not credit. (the credit card debt is all at lower rates than I could get from a refi - and unsecured by any house) All bills are current and I won't go bankrupt, but I am wasting money monthly on interest expense.

Overall, I enjoyed the experience very much and would definitely do it again, just differently. When I get these 2 houses sold, I will be debt free again with money to invest, and I plan to buy a fixer upper to live in while I renovate - ought to be interesting....

[Rich_in_CT]

As you stated earlier you bought too high, that's the biggest factor in your lack of profit. If you bought right you could have priced it lower out of the gate and had it sold by now with a nice profit. All other factors are a far second to buy price, you make money on the purchase.

If you're looking for a new place to do I'll keep an eye out, I am on the other side of Hartford from you. I'll let you know if I spot any gems.

[k6saunde]

What is the Number 1 rule of REI?? Everyone say it with me "You make your money when you BUY not when you SELL"

A mistake isn't really a mistake, its a learning experience. Unless you make the same mistake over and over again, then your just plain stupid.

That being said.....House looks great, good job.

[Dan Auito]

Solid lessons learned there Dwford, thanks for posting up the experience, you'll help someone in the future from telling that tale. Thank you.

[AIR]

excellent post! like K6 said a mistake is a learning experience and I think everyone could def learn something from it. Good luck hope everything works out well for you!:SM058:

[dwford]

While I would have liked to have made a profit on this house, if I did, then it all would have been too easy for my 1st flip, wouldn't it!

[Debbie]

Maybe I heard it on 'Property Ladder' or similiar show---I chuckled when they said that flipping is the best entry level for non-experienced beginners.

[k6saunde]

Maybe I heard it on 'Property Ladder' or similiar show---I chuckled when they said that flipping is the best entry level for non-experienced beginners.

Being a newbie myself, I think I would have to disagree with that statement as well. There are alot less risky ways to get your feet wet. Like bird doggin and assigning contracts. Your not going to make as much money but it does expose you the the industry.

But like I said, I'm a newbie. What do I know??

:SM142:

[dwford]

What surprised me was how relaxing the renovation process was. Even though I did alot of physical labor, worked 6/7 days a week, had all these bills and no job to pay for them, and was doing something totally new that I knew little about, I was never more relaxed!!

I guess having no boss and no co-workers to clash with had something to do with it. I have got to find a way to flip houses full time.

Of course, it did take about 3 weeks for my hands to unclench and stop hurting from gripping a paintbrush/hammer/screwdriver/rake etc..

[k6saunde]

Of course, it did take about 3 weeks for my hands to unclench and stop hurting from gripping a paintbrush/hammer/screwdriver/rake etc..

Thats normal, give it a few years and they will fit in your hand without having to close them at all, LOL

[dwford]

As long as my face isn't contorted the same way...

[dwford]

Well, it's beena month and my investor hasn't been able to sell my house either. I guess I shouldn't be surprised, since he is asking more than I have been all along. I assumed he was charging more because he was taking the owner financing risk, and that he had people willing to pay a premium because they couldn't get bank financing, but it hasn't worked out that way. Now the option contract is up, and we are considering renewing, but obviously he wants to renegotiate the price.

So I have a dilema: Do I renegotiate and accept a larger loss than I was willing to in the previous option contract ($3-5k below my breakeven), or say no thanks and recommit myself to selling it on my own?? Meanwhile, I am paying an interest only mortgage and dropping $1100/month just for the interest.....

My alternative is to keep it and wait for my other house to sell, then move into my investment house. I could then refinance to a regular mortgage and wait out the 2 years to sell tax free.

My other house is a beautiful 3/4 br 2200sqft cape on 2.5 acres. Everyone loves it, but hates the yard, since 3/4 of the acreage is wetlands, making the yard rather small. I have dropped the price a total of $25k since listing in October.

[Randy (SELA)]

Just out of curiousity, have you read Dan's Magic Bullets book? I believe there was some good info in there on selling by owner.

[Randy (SELA)]

Have you considered renting either place until you sell?

[dwford]

Yes I did read Dan's book, and followed all his recommendations. The house is perfectly clean inside and out, I have had it appraised and inspected. I have all the required forms prepared and available for review. I have advertised on line at forsalebyowner.com, and in several newspapers and other online outlets. I have had numerous openhouses and have shown the house to dozens of people.

Basically, the house is overrenovated. While I don't know what I could have not done - other than skipping the stainless appliances, other houses in the market are "good enough" and cost $thousands less than mine. Most of the people who have come through haven't had any down payment money, and were looking to cheap their way into a house. I need to find that customer that appreciates a fully renovated house, and doesn't want to fix/decorate a house after moving in. I even replaced all the regular lightbulbs with compact flourescents (didn't cost more than $10).

[Debbie]

Basically, the house is overrenovated. While I don't know what I could have not done - other than skipping the stainless appliances, other houses in the market are "good enough" and cost $thousands less than mine. Most of the people who have come through haven't had any down payment money, and were looking to cheap their way into a house. I need to find that customer that appreciates a fully renovated house, and doesn't want to fix/decorate a house after moving in. I even replaced all the regular lightbulbs with compact flourescents (didn't cost more than $10).

That is my current fear---we're renovating our current house to put up for sale because our new house will be done soon. Why our fear? That after almost a decade of all potential buyers expecting to buy a completely renovated house, all potential buyers will now want a house that does require renovation!

[dwford]

That's because nobody has any money. I have yet to meet a buyer that has even 5% down. So everyone is looking for the cheapest livable house, with hopes of fixing it up in the future.

I do have a woman coming this weekend who wants a turn key house, but she has a house in Florida to sell 1st.

[k6saunde]

That's because nobody has any money. I have yet to meet a buyer that has even 5% down. So everyone is looking for the cheapest livable house, with hopes of fixing it up in the future.

I do have a woman coming this weekend who wants a turn key house, but she has a house in Florida to sell 1st.

Are these isolated instances or a new trend developing? Could it be time to find the properties and sell without any or with minor repairs? Maybe taking a smaller profit but doing more volume with potentially quicker sales in mind?

[Randy (SELA)]

You might consider renting on of your two properties for the short term. At least someone else would be paying down the mortgage.

[dwford]

I have considered renting, but I have had continued interest (if no good offers) on both houses. I am afraid to get a tenant in then have a real buyer come along.

[dwford]

I got an offer today for my primary residence.

Here's how it goes:

original asking price: $354,900
current asking price: $329,000
offer: $320,000
counter: $326,000
buyers accept at $326,000

The buyers have their house under contract, but a condition of their contract was that they had to have a contract to buy a new home (mine) by this Tuesday, or the inspections for their sale would be cancelled. Their buyers have already sold and closed on their house and are ready to move.

For some reason, my buyers are doing a 100% financing, even though I would expect them to realize a profit on their home. They feel they can do better with their money elsewhere than as equity in their new home. Where, I ask, can you make a solid 6.5% return on your money with no risk? Who am I to judge, I ran up every credit card to renovate a 2nd house and then float myself for 6 months.

I ran some quick numbers, and after expenses will realize a net of about $115,000 on my home, but after paying off all credit cards and my car, will have about $22,000 left over.....which I pre-spent in October when I put a deposit on this: arielatom.com .....which I no longer have a garage for. Months of scrimping made me lose my mind.

I will be moving into my 1200 sq ft flip house with my sister, her 2 kids, 3 dogs and 4 cats. We also have 3 (soon to be 4) cars and a pop up camper to fit onto a .25 acre lot. Won't the neighbors love it!!

I will refi my flip house to a conventional mortgage at a more reasonable rate (9% currently) and wait out the 2 years. In the meantime, I will be saving cash to finance my next flip.

[Burke]

Congrats! I look forward to hearing of a successful close even though this isn't exactly what you had in mind when you started this adventure.

[dwford]

Well, the closing process is proceeding. Both my buyer and their buyer have their mortgages in place, I have begun moving with the big move scheduled for next Thursday. All tests are done, and fixit requests from the home inspection are completed. The buyers wanted 3 things fixed: add a chimney cap, spray for carpenter ants, fix a plumbing vent that vents into the attic. I installed the chimney cap and sprayed for ants, but the plumbing vent meets code so I declined. The buyers seem satisfied. Extermination might be a career option - he found 2 dead carpenter ants, sprayed for about 10 minutes, and charged $265!!!

My buyers seem really confident - we got a call from the phone company wanting to switch over the phones next Tuesday. We don't even have a closing date yet!! Calls to China anyone?

Soon I will be eating what I cooked - living in the house I rehabbed. Hope I did a good job!! This weekend I am going to install more cable lines, and a couple other odds and ends. I tried to order cable online, but both Cox and Comcast say my address doesn't exist, so I guess I have to call.

[Debbie]

Heeyyy! Great going! :thumbsup:

[dwford]

Well, I closed last Thursday. Ended up with a little more at closing than I thought, a nice surprise. Then I got the double whammy: On Friday I went home to let the cable guy in, and my basement in the flip house was flooded - 3 inches and coming. Since we had just moved in, we had a ton of stuff down there. The basement had never flooded in the prior 6 months, but there was evidence it had in the past. The basement windows on the backside of the house are below ground level, and the ground slope towards the house. We got it all cleaned up with minimal damage, but I have some work to do this spring to prevent that from happening again - I plan to finish the basement soon.

While I was out buying sump pumps, I went to the lawyers to get my checks - they did my closing 1st, then my buyers, so there was no money for me at closing. I went to the bank - Bank of America - to deposit the checks, and they put a 7 business day hold on them, which means I don't have my money until the 13th - total BS.

[Debbie]

Well, I closed last Thursday. Ended up with a little more at closing than I thought, a nice surprise. Then I got the double whammy: On Friday I went home to let the cable guy in, and my basement in the flip house was flooded - 3 inches and coming. Since we had just moved in, we had a ton of stuff down there. The basement had never flooded in the prior 6 months, but there was evidence it had in the past. The basement windows on the backside of the house are below ground level, and the ground slope towards the house. We got it all cleaned up with minimal damage, but I have some work to do this spring to prevent that from happening again - I plan to finish the basement soon.

While I was out buying sump pumps, I went to the lawyers to get my checks - they did my closing 1st, then my buyers, so there was no money for me at closing. I went to the bank - Bank of America - to deposit the checks, and they put a 7 business day hold on them, which means I don't have my money until the 13th - total BS.

Ah....the joys of Murphy's Laws...

[dwford]

Just for giggles, I had a basement refinisher come in to give me an estimate for creating 2 rooms and a bathroom out of my basement, about 300 sq ft. nothing fancy, just the basics. Without paint on the walls or any flooring, they came back with a quote for $28,000!!!!!!!! I didn't spend that rehabbing the whole house!

Needless to say, I'll be doing it myself...

[k6saunde]

Bank of America???

Don't you mean the "Bank of American Imigrants without documentation, SS#, bank account, and Drivers License?"

Or maybe they should just call it Bank of Amerimexicanada??

BTW Congrats on your flip!

[Beau_Fla]

dwford,

I got an offer today for my primary residence.

$22,000 left over.....which I pre-spent in October when I put a deposit on this: arielatom.com ......

Very cool car. I really like it. A toy like this is very motivating.

[ThreeRiversREI]

???

Don't you mean the "Bank of American Imigrants without documentation, SS#, bank account, and Drivers License?"

Or maybe they should just call it Bank of Amerimexicanada??

BTW Congrats on your flip!

I believe you're referring to the program whereby Bank of America will issue credit cards to individual WITH proof of identity (such as a driver's license) and WITH an IRS issued tax ID and WITH an established banking history. (In addition to all the proof of identity that had to be provided to open that initial checking account.)

Yes, immigrants can use the program, but non-immigrants can too. But who would use the program and pay almost 30% APR on a credit card if they had any options?

I really wish people would stop blowing a test program so totally out of proportion.

If nothing else, look at it this way. Bank of America has found a way to keep more of the money those "evil" people are earning and keep it here in the United States, so they can't send it to support relatives in their countries of origin.

[k6saunde]

I believe you're referring to the program whereby Bank of America will issue credit cards to individual WITH proof of identity (such as a driver's license) and WITH an IRS issued tax ID and WITH an established banking history. (In addition to all the proof of identity that had to be provided to open that initial checking account.)

Yes, immigrants can use the program, but non-immigrants can too. But who would use the program and pay almost 30% APR on a credit card if they had any options?

I really wish people would stop blowing a test program so totally out of proportion.

If nothing else, look at it this way. Bank of America has found a way to keep more of the money those "evil" people are earning and keep it here in the United States, so they can't send it to support relatives in their countries of origin.

I was making a joke at Bank of Americas expense!

Although you and I seem to have a differece of opinion on the validity of the Bank of America program.

This is NOT the forum to discuss such things. I would be happy to debate you further on this subject however. In the proper forum ofcourse.

And just for the record..... I never said anything about Illegals being "EVIL". But I do believe we are a nation of laws and they are breaking several of them. But as I said, this is a discussion best left to be debated in a more appropriate forum.

[dwford]

Disclaimer: No illegals were harmed in the creation of this thread (or my glip for that matter!!).