One heck of a year!
Hey BP!!
2014 has been a great year. I've been in construction since I was 2 (at least that's what my dad tells me) and have owned a 6 unit rental building since 2007 (I know that is true) but last year I decided I need to refocus on real estate investing. Thankfully I found BP, started reading the blogs, forums, listening to @Brandon Turner and @Joshua Dorkin on the podcasts and got myself motivated to get back into investing.
All of that led to me finding my first private investor and then my first flip. I found an MLS property that had been on the market for a long time and had gone through many price reductions; after a few months of negotiation we closed on December 17th last year. The house had been gutted to the studs, the garage torn down and the basement slab removed, but most importantly it was on a non-conforming lot. About nine months later we had variances approved, the house completely rehabbed and sold it for a profit of $115,000 which I split 50/50 with my private investor who put up all the money. Here are the basic numbers and some before and after photos.
Sale Price - $489,000
Purchase - $154,900
Carrying/Closing (both sides) - $64,100
Rehab Costs - $155,000
Total Profit - $115,000
Before
After
Since then I have purchased another building with 12 apartments and 3 retail spaces, again using a 50% equity partner that put up all the money. Our plan is to gut renovate the 12 apartments, then refinance and hold the property long term. If my numbers are accurate the property will net about $56k per year after all expenses and financing costs.
I've gotta say, this past year really has me excited for 2015. I'm just getting started on a direct mail marketing program and planning to do at least 2-3 more flips, double my rental portfolio again and wholesale or list anything else that comes my way this year.
Happy New Year Everybody!!
Dan