Sold! Didn't Get Rich, But $35,000 is still nice!

18 Replies

Hey again everyone!

I wanted to share a property we just sold yesterday and give a breakdown from start to finish of how the deal went, with hopes that newer house flippers out there can learn from our experience.  Also on this post, I decided to make the pictures bigger since many people asked for larger photos from last time.

Deal Details:

This house was purchased by us very early February this year in a suburb South East of Seattle WA known as Auburn.  We bought it OFF MARKET, probate situation. Owner past away a year prior, had no kids, and house sat there whole time while attorneys tried to figure out what to do with it. A wholesaler picked it up via meeting the attorney and they assigned it to me.

The house had just about everything left in it, kind of sad that no one wanted it or reached out about the older ladies death...

We closed Cash, no need to negotiate, numbers were solid from our stand point.  Calculated $45k rehab, purchase $117k, Resale $215k, good deal.  However we had some surprises, as usual, along the way.

Property specs prior: 3 Bed, 1 bath, 1200 Square feet with an illegal abortion of an addition for another 300 sqft.  House built 1975. 1 car garage

Property After Rehab: 3bed/1 bath (turned into jack/jill bath), 1200 sqft, REMOVED addition and turned section into a large entertainment outdoor deck.

The Bad: Budgeted 45k for rehab, ended up 53k. SOOOO MUCH stuff in the house, dump fees were insane and more than thought. After we bought the house, we completely overlooked that the house had NO HVAC OR ELECTRIC HEAT AT ALL, only had a propane heater in the living room. Had to install all new cadet heaters throughout house (for those not from seattle area, AC is not something common here).  Electrician miscommunicated with GC on where lighting was supposed to be, had to re-do at end of project when caught.

The Good: House sold in 6 days. Neighbors were great, close knit neighborhood.  We bought thinking to sell for 215k, market was hot and rehab great, sold for 237k.

The Numbers:

Purchase: $117,000 ($12k assignment fee included) CASH PURCHASE

Rehab: $53,000 (budgeted $45k)

Holding costs: Roughly $1500

3% concession to buyer: $7110

Closing/Realtor/Excise tax 1.78% WA/Misc: $28,500

Sold: $237,000

Net Profit: $35,283

CASH ON CASH ROI: 20.4%

I tend to buy conservatively, we build in margins of errors into our analysis incase things go wrong, this way, if something does happen, we still make money.  In this business you have to take risks for sure, however you can be smart about them.  An investment isn't what is risky, its the investor investing in it that makes it risky. 

Good deal, @Tarl Yarber .  You did a nice job on the acquisition, on the rehab, and on the sale.  It looks very nice.

Great job man...... how much time do you have in this deal.  10 hours a week for 8 weeks 80 hours total with $35,000 profited  that's $437 per hour...... you should be proud of yourself.

My big goal is to turn my small 7 deal per year jod into a 30 deal per year empire.  Your welcome to come along, there is gold laying in the streets.  Good job reaching down and picking it up.

Nice work!

That's awesome @Tarl Yarber , I'll get there soon, looking at some leads this weekend!

Originally posted by @Jim Keller :

Great job man...... how much time do you have in this deal.  10 hours a week for 8 weeks 80 hours total with $35,000 profited  that's $437 per hour...... you should be proud of yourself.

My big goal is to turn my small 7 deal per year jod into a 30 deal per year empire.  Your welcome to come along, there is gold laying in the streets.  Good job reaching down and picking it up.

Thanks Jim!  Keep focused and get to 30!

Great numbers and job done.it indeed is the investor that has control over risk

Thanks for sharing. This is very educational and encouraging. 

Thanks for sharing! Lots of great info...

This is a great example, although rehab went over budget the numbers were super! Thanks for sharing to newbies like myself. I am sure down the line, I will encounter surprises. It is good to know that in some cases it works out.

Congrats!  Sounds just like how I imagine a flip going.  Unexpected surprises!  Thanks for sharing and glad you made a nice chunk of change!

Nive job Tarl. I hope to get together soon.

Elliot

Dumb question, but 3% commission seems low on the sell how did you do that?  Maybe its your area, I have seen 5% to 6% out my way. 

Originally posted by @Ryan Hall :

Dumb question, but 3% commission seems low on the sell how did you do that?  Maybe its your area, I have seen 5% to 6% out my way. 

 Hi Ryan! I wish I could get a 3% commission! I usually pay 5%.  What you read was a 3% concession, this is for the buyers closing costs.  Sorry for the confusion.

@Tarl Yarber

Another great success for you and your team! Great to see there are still opportunities like this even in a hot market like Seattle. Love your comment about risk. A good investment should still yield a decent return even if the worst happens.

Keep up the great work!

This is a great example of making your money when you buy! Even though things didn't go exactly to plan a 20% profit was made. Great job! 

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