My Biggest Mistake On My First Flip
Over the last two to three years I have been flipping houses, and wholesaling real estate. I have done everything from acquiring a property to dispositioning property for wholesale.
I have built relationships with real estate investors. Not only locally in Phoenix, Arizona, but nationwide. After wholesaling for a little while, I eventually got into flipping.
I flipped my first property, and kind of ran into a couple problems financially.
My girlfriend, Cat, has been bookkeeping and transaction coordination for real estate investment companies over the last year and a half.
On the first property I flipped in central Phoenix. I bought it for $145,000. Then sold it for $255,000. I was 50/50 with the partner on that deal. I was using a spreadsheet for bookkeeping and accounting. I had all my expenses down to a "T".
I was super solid.... I thought.
I was taking all his receipts from Home Depot, Amazon, and other vendors, and entering them into a spreadsheet.
The day of closing, July 31st, 2020, I received a call from my partner and he says, "Matt, how much have we spent on this property?"
I gave him the number.
As I signed all the documents at the title company there were a couple thousand dollars in fees I wasn't expecting!!
About a week after closing, I started finding all these receipts that totaled $3500.
So, My partner ended up making a couple thousand dollars more than I did on this deal.
How did this happen!? After Cat helped me get setup in Quickbooks and get things dialed in, we realized a major need in the industry.
Soooo....We started a bookkeeping business for real estate investors!