BiggerPockets

I'd love to hear stories from the rehabbers out there . . .

Do you remember your first rehab deal? Was it a winner or loser?

Please share some details and what you learned from the experience.

Our first deal was in Bakersfield in a very nice area behind their Jr. College. It took us nearly 8 months to finally win this bid. We thought it'd be easy since we run our own RE business, but it wasnt. The competition was & still is fierce & again finding a great RE Agent out there was not easy either!
Bought 3/2 bath, built 1954 with large front lawn & decent back yard size. Paid cash $63K. We took our Agent's suggestion & used his friend who said he had managed a crew for KB homes, which sounded very impressive, but we ended up driving up(Ventura County) more times than we wanted to & had to ask contractor to do this & that. The rehab cost -$18K. New sod front & back! New Kitchen floor & appliance, Paint inside & outside, New floor tiles-entrance & bathroom. New bathroom tiled with new water fixtures in kitchen & bath. New lighting in kitchen & entry way. Funny thing, we wanted to participate with the rehab & decided to work on the yard, so we planted seeds & grass barely grew, so we decided to hire landscaper to do the grass! We decided to stick with what we know best, RE!
The property sold for under $100K, net profit $15K. Our first rehab was not a big winner in the sense of money, but overall we purchased, rehabbed & sold property within 90 days!
We learned that we needed to find a contractor who we can trust & have done rehabs for years. Finally we did find an incredible contractor who does not need supervision. Presently he has completed 2 more rehabs for us & again the timeline has been 90 days for 2nd & 3rd rehab.
We also learned to leave all the construction to the contractor & our job is to find more properties.
From our experience, buying low & selling low has been helping move our properties quickly.
We use the same realtor who found the property sell the property for us. We truly become RE Investors, except we do our own due diligence & comps. Our entire team is a win win situation!

my first rehab took all summer while i was in college...actually into fall semester, i still was washing dishes out of my bahttub bc i didn't have a countertop in the kitchen....i paid too much for the house, overdid some of the rehab, used the wrong contractors (read cheap, but not professional)..i still have it as a rental, but man did i learn a lot over there! i'll have to dig up some pics..i also learned that i don't enjoy living in a construction zone :)

My first rehab went very well. I had some experience in construction project management / rehab & development - but the best thing I did on this rehab was post my Q & A's on Bigger Pockets. I started a thread to log the details of my first rehab, hopefully to help other people out. We closed March 2011, and finished the rehab May 2011. I under estimated the rehab expense, went over budget by about $5,000, and went over on the time frame. I believe my biggest mistake was using a GC (who over charged - thought I would be paying for great service). My project sat idle for 2 weeks, and the GC forgot to order windows. From this, I learned that #1 I will never use a GC again, and #2 Have a list of your lead time items (granite, windows, refinish floors, resurface tubs, etc). We bought the house at $65,000, spent $30,000 on rehab, and have the house on the market for $137,000. We've had 7 showings in 7 days, and 1 offer.

I have purchased several properties that required rehab. My first one was an REO purchased in 2001. It was a single family home that the owners left behind truckloads of garbage.

The property had a large bathroom and needed electrical and some plumbing upgrades. I also had decided to convert a carport into a den. I did most of the work myself employing helpers only occasionally. The rehab took about 5 months, but I learned a lot. I spent 17K on materials.

I never calculated the real cost of my time, but this and other projects have made me realize there was not much I couldn't do around the house.

I purchased the property for 149K and added 17K in materials plus my time. My latest tenant has been in the property now for about 3 years and the have taken care of the property quite well.

My wife and I were just talking a couple days ago about the fact that -- now that we've been in this business about 3 years -- we're going to start seeing houses we've sold coming back due to foreclosure. It will no doubt be sad (we've liked most of our buyers), but also a great opportunity...

My first rehab was on a personal residence back in 2003, so it does not really count. My first real rehab to then re-sell was in 2007 (before that, I was buy and hold only) and it was a disaster.

The property was in TX (I live in CA) and it started out as a rental. We could never get good tenants in there and decided to exit via rehab. It was mid July in TX heat and I flew out there to do much of the work myself (big mistake). First off, I did not have any of my own tools there which made the work difficult and everything I did have was borrowed, rented, or purchased there.

The home was disgusting, I would not subject my worst enemies to live in such a place. Being a ball player, I am known around town to be the fastest runner around (or at least I was in my younger years), but had anyone been there, they would have seen lightning speed as I had to scramble to run out of the house after stepping into the laundry room from the kitchen to avoid yacking. Once outside, it was all I could do to not toss my cookies in the yard. Any future entrance to the home required a mask.

Long story short, contractors and subs (carpet installers, painters, etc.) were impossible to mnage from afar once I got back home and did not do the jobs in the timeframes or qualities I would have demanded had it been a local deal. The end result was a loser, but this was a purchase to hold and not originally intended as a flip so I discard it from my rehab flip totals.

All in all, what I learned is that doing rehabs from afar is something i will never do again, I will never make the mistake of buying a rental in the wrong area again, and I will never do the types of labor I subjected myself to on that project just to save a few bucks, especially know as my time is much more valuable now than it was then.

For all of my rehabs I have done locally, I have only lossed money once. It was a home next to my personal residence i puchased REO. Even though I lossed around $1000 (very small loss amount here in CA), it was somewhat of a gain/benefit because I was able to fix up the nieghbors house the way I like it to look and I got to choose my neighbor. It was a toss up to buy it or not to buy it and I had several reservations in my mind. A great learning expereince for me came from this purchase as well and it is this: If I ever do not have a complete warm and fuzzy about a rehab opp., I WILL PASS on it.
Intuition and gut feelings may be something to discard fro some, for me, I find them valuable and ignore them at your own risk!