Real Estate Deal Analysis & Advice

Best Deal Ever Show #18: How a $20K Property Turned Into $100K Net Profit

Expertise: Real Estate Investing Basics, Landlording & Rental Properties, Real Estate News & Commentary, Mortgages & Creative Financing, Real Estate Wholesaling, Personal Development, Flipping Houses, Business Management, Real Estate Deal Analysis & Advice
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With a fast, “go with your gut” approach, Shawn Wolfswinkle was able to find a gem of a property that truly is one of the best deals that we’ve seen.

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Shawn owns Texas Turnkey Properties and also owns a property management company. He has 18 staff members, two offices, and manages over 1,300 homes in the greater Houston, Texas, and Albuquerque, N.M., areas. Texas Turnkey Properties takes on the role of building new construction (selling at less than $100 per square foot), while also renovating properties to rent out.

All this to say, Shawn absolutely has a knack for finding the best investment opportunities!

How Shawn Finds Deals

One of the primary ways that Shawn has been able to get a phenomenal ROI with his new construction in the last three-and-a-half years has been by finding great deals on lots and building a large quantity of the same model. (He currently builds around 130 new units per year.)

While finding deals on lots can be tricky, one of the primary ways that Shawn is able to find deals on lots is through aggressive pay per click advertising and direct mail.

Shawn’s Best Deal Ever

One of Shawn's best deals ever was in a little town called Round Rock, Texas. Shawn heard through a contractor that an elderly woman wanted to sell her home after her son, a developer, said it wasn't worth anything due to some foundation leveling that needed to be done.

Related: Best Deal Ever Show #15: 2 for 1 Using the BRRRR Method With Brittany Arnason

What was incredible, though, was that the owner only wanted land value for her home, which amounted to $20,000—even though the home would likely have appraised for $135,000!

After looking at the property on Google, it almost seemed like the home was too good to be true. That same day, Shawn immediately decided to drive three hours to meet the owner and see the house in person. By doing so, he found out that the house only needed cosmetic work! Everything from taxes to the title were clean.

Shawn was ready to close the deal that evening. Writing a check and signing a warranty deed, the house became his on the spot.

The primary risk involved was that Shawn didn't opt to have title insurance, but his company had the margins to absorb the cost if this investment didn't turn out to be what he expected. He figured a potential title issue was worth the risk of potentially losing out on this killer deal—so he still decided to close then and there.

It was only 55 days from the time Shawn got the lead to when he re-sold the home for $165,000. Renovations only took two weeks and cost $25,000. All that was needed was foundation leveling, new lighting, hardware, flooring, paint, and countertops.

How to Apply This Strategy to Your Business

Athlete runner feet running on treadmill closeup on shoe

Shawn’s advice for those wanting to do more investing is that hustling and acting quickly is key—or else you’ll get beat.

Related: Best Deal Ever Show #13: Investor Buys Entire Ghost Town—Wait, What?!

A book that he goes through with his staff and recommends to others is Relentless: From Good to Great to Unstoppable by Shari Wenk and Tim S. Grover. A theme from the book is that “when you’re in the zone, you don’t think, you just act.” He says that you need to be willing to move and be tenacious to get deals like the one mentioned above.

For anyone wanting to find a better deal, what are some strategies that you’ll start implementing to help you act more quickly?

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What’s the best deal you’ve ever found? Questions about Shawn’s story?

Let’s talk below.

Ken Corsini is a seasoned real estate investor and business owner based in Woodstock, Georgia. Ken is best known for his role on HGTV’s hit show “Flip or Flop Atlanta,” and has flipped over 800 hou...
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    Michael P. Lindekugel Real Estate Broker from Seattle, WA
    Replied 7 months ago
    if the home appraisal would likely be valued as-is at $135k , then why would the seller choose to lose $115k and sell for $20k?
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Great question, Michael. As Patrick mentioned below, the seller's son advised her that she would be better off without the liability of a foundation issue. Shawn's situation was definitely risky, but worth it in the end.
    Patrick Torres Rental Property Investor from Albuquerque, NM
    Replied 7 months ago
    Unless facts were omitted from the story, because she trusted her son who gave her very bad advice.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    She left the home and moved to Houston two years prior. So it had been vacant for two years. She didn't want to deal with it anymore. These kind of deals are extremely rare but being in the business long enough, deals like this will fall into your lap. Tell me more about what you focus on in Albuquerque. I was born and raised in Santa Fe and went to UNM. I own a management company in Abq. Maybe there could be some synergy there.
    Beau B. Bray from Gloucester, VA
    Replied 7 months ago
    I'll admit that it's a great deal, but is it just me? Or do aspects feel a little icky? Like an elderly woman was take advantage of...
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Beau, definitely a once in a blue moon type of story! At the end of the day both the buyer and seller got what they were looking for. Understandably, a son would likely know his mother's priorities and had a reason for encouraging her to let the property go at the specific purchase price. Mother could have wanted a quick sale, or to avoid the headache of dealing with a foundation issue.
    Michael P. Lindekugel Real Estate Broker from Seattle, WA
    Replied 7 months ago
    in WA State it is called elder abuse and equity skimming.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Deals like this are rare. Nobody was taken advantage of and her son was aware of the transaction. They didn't want anything to do with the home. She had move away to Houston two years prior and the home was vacant during that time. They wanted to move on and get rid of the property. I understand its extremely rare but 20 years in the business I have had only a hand full of opportunities like this fall into our lap.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Hey Michael, definitely this is a once in a blue moon story. Thanks for your comment. Understandably, her son probably understood her priorities (which might have been a quick sale) and as a contractor knew the liability of a foundation issue that could have turned out to be more of a headache that she was wanting to take on initially. Good thing that Shawn was in a position to where he could be able to absorb the cost of the investment, should it not be what he expected.
    Moyra Rasheed from Dublin, California
    Replied 7 months ago
    Yes I feel that this elderly woman was taken advantage of. I know we are on here to earn more, but I have my limits... I know that I am not as rich as investors but there are some things that are difficult to do- like not let her know that her house was actually worth something.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Deals like this are rare. I can assure you nobody was taken advantage of and her son was aware of the transaction. They didn't want anything to do with the home. She had move away to Houston two years prior and the home was vacant during that time. They wanted to move on and get rid of the property. I understand its extremely rare but 20 years in the business I have had only a hand full of opportunities like this fall into our lap.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Hey Moyra. Thanks for the comment! Understandably, her son probably understood her priorities (which might have been a quick sale) and as a contractor knew the liability of a foundation issue that could have turned out to be more of a headache that she was wanting to take on initially. Good thing that Shawn was in a position to where he could be able to absorb the cost of the investment, should it not be what he expected. Definitely a once in a blue moon type of property.
    Dan Sheeks Rental Property Investor from Denver, CO
    Replied 7 months ago
    I wouldn't be able to sleep at night knowing I stole $100k from an elderly woman. It doesn't matter what her son told her. I've found it's always best for the long run to be honest and transparent with people. But to each their own...
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Dan, I want to be clear we didn't take advantage of anyone and her son and family were aware of the transaction. I apologize if that was conveyed in the interview. They didn't want to repair the foundation and rebuild the home. They just wanted to get rid of it and move on. We were referred by a contractor that did work on her home and she knew so we were trusted.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Hey Dan, keep in mind that her well-meaning son who advised her to let her property go at the price she did. Understandably, her son probably understood her priorities (which might have been a quick sale) and as a contractor knew the liability of a foundation issue that could have turned out to be more of a headache that she was wanting to take on initially.
    Jill Curran from Little Rock, Arkansas
    Replied 7 months ago
    Agreed. "Deals" like this are what gives RE investors a deserved bad name.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Jill, We have been in business for 20 years and have a very good reputation. We were referred and a solution to her problem. We were very upfront with her and her family. We gave them exactly what they were requesting and removed the burden.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Thanks for your comment, Jill. Keep in mind that seller was being cared for by her son who advised her to let her property go at the price she did. Understandably, her son likely understood her priorities and knew the liability of a foundation issue that could have turned out to be more of a headache that she was wanting to take on initially.
    Hope Fick Real Estate Agent from Warrenton, Missouri
    Replied 7 months ago
    Not just you. People take bad advise all the time unfortunately.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Hope, Thanks for the feedback. We were a solution to her problem and she didn't need the money and wanted to just get rid of the property. Her son advised her to sell it for land value only and get rid of the home. It seemed more like a hassle to the family and money obviously wasn't an issue.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Thanks for your comment, Hope. The seller was being cared for by her son who advised her to let her property go at the price she did. Understandably, her son probably understood her priorities and knew the liability of a foundation issue that could have turned out to be more of a headache that she was wanting to take on initially.
    John Murray from Portland, Oregon
    Replied 7 months ago
    I just made $110K on a flip and zero taxes. I lived there for a few years and vacated for reno and put in 3000 hours of my work. I did not rip off an elderly ignorant women. Karma is a bitch and it's coming for Ken.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    John, That's awesome you did well on your flip. In this case, the family was fully aware of the sale and the son was the one that requested the sale of the home be at land value only. We have a lot of properties, Houston and Austin, that are sold at land value only. This is not uncommon as the sellers feel that homes are not rebuildable and they are selling for developers to come in and build new construction homes on the properties. The seller and her son felt this was the best option for the rapidly growing marketing in Austin.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Awesome job on the flip, John. In Shawn's defense, however, the seller trusted her son's advice to let her property go rather than take on the liability of a foundation issue. Keep in mind that her son is a contractor, too! We don't know all the details to what the seller's priorities were, as she might have only a quick sale, but we do know that both parties ended up with what they were looking for.
    Jackson Hart from Petaluma, California
    Replied 7 months ago
    agreed
    Jackson Hart from Petaluma, California
    Replied 7 months ago
    oops, yup I mean Shawn has karma coming for him?
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Hey Jackson, in Shawn's defense, the seller trusted her son's expertise on her situation, and he was also a contractor. Understandably, we don't know all the details to what the seller's priorities were, as she might have only a quick sale and possibly didn't feel like a foundation project was something she wanted to take on. However, both parties ended up with what they were looking for.
    James McKenna from Northern New Jersey
    Replied 7 months ago
    John Murray - Why are you calling out Ken? The story is clearly about someone named Shawn....
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    James, you are correct. Ken Corsini was just conducting the interview for Biggerpockets. Ken had asked us to share our best deal ever. Nobody was taken advantage of and the story about our best deal ever was meant to share that deals like this are possible if you are in business long enough, people trust you to refer clients to you, and you maintain a solid reputation in your community.
    Jake Zamesnik
    Replied 7 months ago
    I'm very new here but this article made me disgusted at the way this dude took advantage of an elderly womans ignorance. I'm glad to see others on here felt the same.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Jake, The seller and her family were aware of the condition of the home, the cost to repair it and they didn't want anything to do with it. They felt the structure was not worth anything. Her son was the one that deemed it worth land value only and we gave the family their asking price. We didn't take advantage of anyone. We have been in business for 20 years and have a great reputation in our community, in the REI space, with our employees, and most importantly with our clients. We wouldn't have been able to achieve this if we took advantage of people.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Totally understand your point of view. In Shawn's defense, however, the seller trusted her son's advice to let her property go rather than take on the liability of a foundation issue. Keep in mind that her son is a contractor, too! We don't know all the details to what the seller's priorities were, as she might have only a quick sale, but we do know that both parties ended up with what they were looking for.
    Jackson Hart from Petaluma, California
    Replied 7 months ago
    Hmmmm, I don't mean to sound like a troll (I love Bigger Pockets!) but doesn't this kind of sounds like he knew that an elderly women was misinformed, took advantage of her, then screwed her over for significant gains? Success is built upon good strategy. Maybe the bigger details are missing but this sounds similar to a con (Not saying it is one though).
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Jackson, The seller and her family were aware of the condition of the home, the cost to repair it and they didn't want anything to do with it. They felt the structure was not worth anything. Her son was the one that deemed it worth land value only and we gave the family there asking price. We didn't take advantage of anyone. We have been in business for 20 years and have a great reputation in our community, in the REI space, with our employees, and most importantly with our clients. We wouldn't have been able to achieve this if we took advantage of people.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Hi Jackson, thanks for your comment. The seller trusted her son's expertise in this instance, who insisted that she let the property sell at land value. Understandably, someone in her situation might not want to take on a project in which the foundation needs work. This story is certainly a rare instance where there could have been more potential problems that Shawn could have encountered that he wasn't initially aware of, for sure.
    Joan Donnelly from Cincinnati, Ohio
    Replied 7 months ago
    This is a horrible story and why investors can get a bad reputation. Old people do not have the means or time to recover from this. Many times their house is their largest asset. They could also not have the mental facilities to make wise decisions. Shame on you. How would you like some jerk taking advantage of your grandmother like this?! Respect your elders and grow a conscience.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Hi Joan, thanks for your comment. The seller trusted her son's advice in this instance, who insisted that she let the property sell at land value. Understandably, someone in her situation might not want to take on a project in which the foundation needs work.
    Sherry Norman Wholesaler from Kenvil, New Jersey
    Replied 7 months ago
    If the son was a RE (not software, or something else) developer, he certainly should have been aware that the house was not worthless. I have a hard time understanding how a son who worked in this field would have told his own mother something so off-base. Like many other commenters, my reaction is disbelief.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Sherry, I can't answer why the son wouldn't repair the home himself. He didn't want anything to do with it. They didn't need the money and the home seemed more like hassle to them.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Definitely a crazy story!
    Sherry Norman Wholesaler from Kenvil, New Jersey
    Replied 7 months ago
    Sorry to add another 2 cents, but may I also point out with no disrespect to the author that the best blog posts are about things many of us would be able to use in our investing lives. I think that I can pretty safely predict that very very few of us will ever come across a deal like this. The part about Shawn being so successful b/c he acted so quickly is also not widely relatable to most of us. Even after overcoming any ethical misgivings most of us have instinctively felt and expressed here, how many of us have $20k sitting around like Shawn that we can take a flyer on? A situation would probably more often arise that the investor is being set up in some way and loses the $20k.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Sherry, we take calculated risks in our businesses all the time. We felt the outcome was worth the risk on this transaction. We were transparent with the seller and her son.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Sherry, you're definitely right that deals like this aren't things you see happen every day and this situation was risky given that there was no title insurance. Shawn was in a great position where his business could absorb the cost of the investment, should it not have been what he expected.
    Matt O'Brien Rental Property Investor from Plano, Tx
    Replied 7 months ago
    I wonder how he would like it if someone did that to his mother? He's a shark.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Matt, We worked with the seller and her son. Both of them wanted to get land value only as they felt that was what the property was worth. He didn't want the hassle of the home. Nobody lived in the city anymore and the property was getting more run down.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Totally see where you're coming from, Matt. However, in this situation, the seller trusted her son's expertise and decided that she wanted to sell it at land value.
    Tim Kalliomaa
    Replied 7 months ago
    Wow, this thread really has me thinking. Yes, real estate investors need to find wholesale deals for the numbers to work on a rehab, but it is important to create a win-win for all parties involved. Many people should have been involved in helping set the asking price- the seller, her son, a real estate agent, a foundations contractor. Did the buyer know for sure the house could be releveled? Probably not if he was buying it on the spot without a foundation contractor on hand to appraise the situation. So while this deal turned out very lucrative for the buyer, the whole house may have needed to be demolished as well. Also, there is a lot of assumptions as to the financial and mental status of this "grandmother". With a real estate developer son, she should be financially well-taken care of and perhaps was moving in with the family now that her house is sold. Regardless, still time to make this right if this was not a win-win for everyone.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Great thoughts, Tim! Shawn definitely had some risk with purchasing the property the very same day and very well could have incurred more issues that weren't initially visible. And yes, the seller trusted her son's advice and saw more value in selling her property rather than undertaking a foundation project for her home.
    Deb S. Rental Property Investor from Punta Gorda, FL
    Replied 7 months ago
    I don't know how some people sleep at night. This is just wrong and deceitful!
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Deb, The son and seller understood what they were doing and the value they were selling the home for. They wanted to get rid of the home and the hassle of it. The felt it was only worth land value only.
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    No deceit, here! Rather than undertaking the responsibility of the foundation issue, the seller saw more value in letting Shawn purchase it and trusted her son's advice.
    Andrew Syrios Residential Real Estate Investor from Kansas City, MO
    Replied 7 months ago
    Well $100K ain't to bad at all...
    Ken Corsini Flipper/Rehabber from Woodstock, GA
    Replied 7 months ago
    Definitely not!
    Conrad Steinweg
    Replied 7 months ago
    I get your answers here Ken in defense of Shawn. Let's step back. Take Shwan out of the picture. Start over with that sale. The buyer arrives at the property. That woman should have been advised. I don't care what the son said. I dont care what assumed loss Shawn thought he was taking on. A few well placed statements to that woman would have brought the ethics to level. My ex's grandmother sold 120 acres at garage sale price to a broker in a closed door mtg. Didn't tell her family anything. Sought no legal/cpa/broker advise. It was prime farmland next to a tourist center that later became a large waterpark. How enraging. All that family equity lost. Back to Shawn. There was financial room for a win win there. I've had sales people be honest to me before.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    Conrad, I appreciate you sharing your own personally story. We felt we were providing the win/win in this transaction. The difference from your personal situation was the family was aware and the son was the party that gave the price to sell the home at. The home was a hassle to the family and they didn't think it was worth rebuilding so they requested land value only to sell and move on.
    Shawn Wolfswinkel from Houston, TX
    Replied 7 months ago
    First, I genuinely respect the opinions of those that have commented about the story that I shared on Bigger Pockets. I feel like some clarification is needed, and I'd like to clarify a few points for a broader understating of the exact issues. I have and will always conduct my business practices fairly and with a high moral compass. It not just important to me within my business; it's the cornerstone of my tenets in everything I do. I want to assure everyone that at no time was anyone taking advantage of in this situation. The discussions that I had with the family were transparent and meaningful. It was an extraordinary circumstance, and the family did have strong private and mainly economic reasons for selling the house for the property value only. When you take into consideration their personal interests and the risks that we were taking on by moving forward without title insurance and not knowing the full extent of the damage to the foundation, it was a mutually beneficial arrangement. I think another surprising element to add to the discussion is that this specific area of Texas, near Austin, has a pent up demand for rehabilitated or even completely remodeled homes, especially in highly rated school zones. With multiple offers at play, we were surprised by the final price that was realized by the refurbished house. Sometimes specific markets like this one get very hot due to local and seasonal pressures. Again, this was an extraordinary situation, and when you add all the pertinent elements, it is reasonable to see how we got to where the deal ended up.
    Meggan Kaiser
    Replied 4 months ago
    So, are all the dissenters saying that if a mother and son (who sound like they were relatively informed and well-to-do) *confidently* told you that they only wanted to sell for the land's value, that you would try to convince them to push the number higher? Are we saying that it's ALWAYS up to the investor to try to convince someone that they need to be a more responsible adult, etc. etc.? I 100% get it if it's a downtrodden human who seems truly in need of a break, but that just doesn't seem to be the case here. This woman seems like she didn't care about the property (where she hadn't lived in 2 years and which her son had purchased for her). Should he have really tried to convince her that she was wrong? Is that the investor's job? I get that she was an elderly woman, but that doesn't automatically mean she was helpless, dumb, or weak. It's just as likely that she was savvy, wealthy, and didn't want any hassle. Bottom line? I don't know, and I'm not joining the mob here until I actually know what I'm talking about.