First 2 flip projects - Pleasant Nightmares!!

14 Replies

So I coined my own term “Pleasant Nightmare” after a started my first 2 flips.

One in Sparta, NJ

  • Bought it for $175k
  • Rehab budget $125k
  • Should sell for $425k

One in Hillside, NJ

  • Bought it for $95k
  • Rehab budget $35k
  • Should sell for $220k

I have 2 partners. What’s interesting is that I’ve been reading the E-Myth along the way, which discusses your 3 basic business owner personalities:

  1. The Entrepreneur
  2. The Manager
  3. The Technician

Any business must balance these 3 well. We have naturally each taken a role based on our own backgrounds and personalities.

I take on the Entrepreneur role, as I envision

  1. 2 houses flipped year 1
  2. 5 house year 2
  3. 10 houses year 3

We have our 2 flip projects now acquired in June and set to be on market by September

My partner Lynn takes on the Manager role. She is essentially the site manager and does all the day to day stuff, babysits the contractors (for a part literally!), and reports to myself and Steve (The Technician).

And Steve is the Technician. He knows how to build from the studs up. Lynn consults with him reviewing the task items, assessing the contractors work, any changes needed,…

So, together, we each take a personality and try to balance the business growth as much as possible.

So I coined “Pleasant Nightmares” based on all the mishaps we have had along the way here in our first journey together. TOO MANY TO LIST! We have gone through 3 contractors on the Sparta job, received a fine for the contractor opening up a wall improperly, watched contractors come to work 1pm, completed tasks out of order which holds work up, had days where no work is done costing us money!!

That’s the nightmare side.. Now the pleasant..

We bought it at the right price to take these hits, learn, and still make money.

My partner was about to spend $25k on a flipping program. Nothing against that, but she essentially invested that in these 2 projects and is learning tons! We, together, are learning, making money, and building a great network of workers to get us through the present and help us build the future.

Bottom-line: I think you need “pleasant nightmares” to grow, expand, challenge yourself, and ultimately create what you envision. Mitigate your risk by surrounding yourself with people you know and trust. Fear will always lurk where there’s risk. But financial freedom doesn’t come through absolute security. Otherwise, everyone would be free!!

Those are some nice numbers! Question about the Hillside house, I know in some areas of Hillside the whole block of houses seem like they need a bit of TLC, was this the worst house on the block or where there others like it? Also did you get the property though the MLS?

Mike,

Hillside has up and down in areas, but better the Irvington in my opinion. A lot of people from there seem to be moving to Hillside, as its a bit better (area, schools). There really wasn't a bad house on the block. Some areas of Hillside are actually pretty nice. I have a great realtor that knows the area well. That's the key. Someone who know where you want to be. She found it on MLS. But, it actually wound up on an auction website. We did a pre-auction bid and got it.

Thanks man!

seems like a great experience and also great teamwork!!! I like your goal plans mines is similar.. Good luck to u and your team...

Thanks Deshawn. Divide on conquer!!

Rafael Norat , Nice !!! "Pleasant Nightmare". Inspirational for me to see you moving forward tho. Have the properties sold yet?

Have to admit to being a little green... Green with envy that is.  Congratulations on two successes.  And may you and your team have many more.  

By the way, how did you and your team meet?  Were you acquainted before you got started?  If so, what prompted you to get together and go for it?  

Thanks for sharing. 

@Ricky Butler          Hillside is under contract and Sparta we are still awaiting. The work done on Sparta was not up to par with that area. So, that one is going to cost us a bit on the end. Definitely looking to tighten things up a bit in terms of contracts and contractors. And only one at a time next time!

@Karen O. These are some tough lessons Karen. Nobody likes losing money. But, you need to keep your mind focused on growing and surround yourself within good environment of positivity and aspirations. I met my partners along the way. Its been a great lesson in working together and dividing roles.

I love your insight and how you relate it to The E-Myth.  I think this is one of the best business books ever written and it changed my business!  Im in Sparta and currently flipping a home their now.  I have  a long term and deep understanding of the market there and world be happy to help if I can.

@Adam Anderson I'll definitely reach out Adam. That was our first go in the area. First go period! But yes, any time I take something on, I try to step back and look at where each hat of the E-Myth is being used and how.

congrats on the deals.learn all the way

Rafael Norat , Do you think the issue was within the contract language, workmanship, or did you guys unintentionally under renovate for that market?

I sent you a PM

@Ricky Butler all of the above man! We lost our original crew and then got caught up on schedule timelines and made some bad choices within our hiring process. Not just the workers, but our fault as well as part of the learning curve. I still feel our price was right and we estimated costs well. Just chalk it up to experience and move on.

@Adam Anderson I will definitely reach out to you and talk some shop!

Rafael Norat , As it appears, you've identified some issues. Experience is our best teacher. I'm located right in Montclair feel free to connect with me at anytime

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