Our First Investment Flip House in Newark, NJ
It took much longer than expected, but my investor client finally closed on his flip in Newark!
Most of the delay was caused by the bureaucracy of the City of Newark. Myself and the listing agent weren't familiar with Newark's requirements, so we can shoulder some of the blame. Chalk this up as a learning experience for next time.
Despite the property being a complete renovation & inhabitable, the city requires a CCC (Certificate of Code Compliance) inspection and a hearing to acquire a temporary CCC. Usually with a foreclosure listing, the buyer is responsible for paying for and obtaining the CCC or CO (Certificate of Occupancy). However, the City of Newark requires the seller to obtain it. The hearing took about 2 weeks to get scheduled after the inspection was performed. Despite some things I read online about dealing with the city, it went pretty smooth. I was directed by a fellow real estate agent to contact Ms. Holmes in the code enforcement office. She was very knowledgeable and helpful.
Shout out to Ibrahim S on the Bigger Pockets forums for his help also.
We had a problem even before closing. We went to check out the house and were unable to open the metal security door that the lender had installed for security. When I looked around the back corner of the house, I found a giant hole in the siding! Someone had ripped off a portion of the wood siding and broke a hole in the wall to access the house. Looks like we had some squatters in the house. Add one more repair item to the punch list now!
The closing went smooth and the renovation was started this weekend. Check out the before pictures.
Comments (7)
That's crazy what ended up happening to the property. I once had 4 adjacent properties in a warzone under contract. I couldn't move them for anything. Not even a offer. It was probably because something like this would of happen. The grind continues...
Chaz Reid, about 9 years ago
Hi Kevin -
Just wondering if you completed the flip yet? Would love to see some after pictures!
Travis Grossi, over 9 years ago
Hey, I think Bigger Pockets is also for sharing the bad things that happen when you invest, so here it goes.
Despite warning my client that he needed to secure the house once he closed, he didn't. He said 'there's nothing to steal.' Well the local homeless people broke into the house (which wasn't that difficult) and basically pooped everywhere and destroyed the house. So he now has an insurance claim on the home, so no renovated house for me to list.
Lesson learned, maybe investors only willing to buy super cheap houses aren't that serious of an investor? Maybe they need more skin in the game to actually take the flip more seriously? I don't know.
Kevin Hill, over 9 years ago
Thanks Tiara! The basement is pretty rough down there. Copper pipes all gone. Pictures should be night and day when its all complete!
Kevin Hill, almost 10 years ago
wow! That's about all I can say. (The brick wall behind the overturned water heater is nice. There's that!) Good luck and I too look forward to the after pictures.
Tiara Muhr, almost 10 years ago
Right now it is Josh! And I even left out the pictures of bags of poop, drug paraphernalia, and a used condom (gross!). I'll definitely post the 'After' pics when its done.
Kevin Hill, almost 10 years ago
Looks like a real dump! I'm looking forward to seeing the finished product. Please be sure to share that with us . . .
Joshua Dorkin, almost 10 years ago