24k Profit on Flip #3 and #4

2 Replies

Note: Link to pictures posted at the bottom.

So for my first two flips, I posted a full breakdown of numbers, to include closing costs, financing costs and holding costs. However, this time around, I am a little short on time, so I will just say this. Closing, holding and financing costs have been consistently around 15% of the ARV. That is with me paying most of the closing costs at purchase and sale and with holding the properties for 2 to 4 months. If you would like to see some examples of how the numbers break down, then check out my previous posts.

Flip #3 Details

502 Maize Ct

3 Bed/2 Bath

1440 sqft

Purchase Price 87k

ARV 150k

Sales Price 150k

Renovations Estimate 28k

Actual Renovation Cost 35k

Original Profit Target 12k

Profit 7.5k


Awkward shaped

Crap and piss everywhere and soaked into the baseboards.

Roof that looked good until pressure washed

Closets arranged in a way that made the bedrooms not very functional

No pantry and limited storage

Overall decent condition considering.

No enclosed fence, but had fencing on the back yard as well as on the sides from the neighbors. 

What was done:

Painted inside and out

Painted roof

Replaced flooring with new laminate, tile in baths and carpet in rooms.

Replaced the tub, vanity and lighting in the master bath and tiled the shower and floors.

Replaced the vanity and lighting in the guest bath and tiled the floors

Painted and repaired cabinets and installed granite counters and subway tile backsplash.

Moved master closet door from the inside of the room to the bathroom

Removed original closet door in hallway and moved it to the master bedroom so that the master had a "his and hers" closet.

One of the smaller rooms had a cubby hole next to the closet so you could fit a small desk and chair. We made this section into the new hallway closet. Made the room look better and returned closet functionality back to the hallway.

Removed walls to open up the living room, dining room and entry way.

Added pantry to kitchen in order to add more functionality and make the room more square shaped. 

Fixed fencing in the back yard and added fencing on the side of the house so that the fencing was inclosed.



This was definitely one of the least glamorous flips I have done so far. When I had picked up this property (and the other one that I will be discussing further down on this thread), I had no inventory. So I shot for lower profit margins and was willing to be a little less picky on the property and it's location. While I certainly didn't lose money on the deal, I didn't make nearly as much as I would have liked. This particular property was in a location where inventory moves a little slower (but not too much slower) and the layout was flawed by design with few options to correct it. Because of this, I spent more money on things like granite counters and nicer lighting options than than I would have normally. I also took down some walls and built in a pantry into the kitchen. All this was done in effort to make up for the awkwardness of the home. This all cost me a few thousand dollars more than what I had originally budgeted. After selling the last house, I was fairly confident and hopeful that I could make this up by selling the house for a little more than our original ARV. This did not happen. Unfortunately, the house stayed on the marketing for longer than I had hoped and most of the feedback we received was mixed. Almost everyone commented on how beautiful the house was, but they said that the layout would not work for them. Finally, we got an offer on the house for 148k. This was 7k less than what we listed it for. From what I was told (and mostly able to confirm) the couple who ended up buying this house was looking at another house in the same neighborhood that was also a flip. This house was roughly the same size and had the same color scheme, the same floors and even the same granite counters. The only thing it didn't have was a bad layout. Basically, the husband liked this comparable house, while the wife appreciated and even loved the layout of my house. But, it all came down to the price. This other house was on the market for $148k, so they wanted to buy my house for the same price. At this point of time, I had two other houses under contract to purchase, but I wouldn't be able to close on both of them without first closing on this one. I knew I was not making much on this house, but the potential profit on the other two houses were much greater than the little bit of profit I would lose on this house. Not wanting to go down too low and banking on the fact that the husband believes in the saying "happy wife, happy life" I countered with 150k and luckily, they accepted. A few weeks later, we closed on the house.

During this project, we did run into a few other issues, mainly with some of the sub contractors, almost all of which had to be fired. This also cost me more money since I had to have much of the work done twice rather than once. This also meant that the project took longer than it should have. 

While this was going on, my other house was sitting there, mostly not getting done at all. Unfortunately, my contractor had bit off more than he could chew at the time and had to work double time to get my other house done within a reasonable amount of time. 

Flip #4 Details

515 S Pine Cone Lane

3 Bed/2 Bath

1440 sqft

Purchase Price 60k

ARV 130k

Sales Price 135k

Renovations Estimate 36k

Actual Renovation Cost 37k

Original Profit Target 12k

Profit 17k


Siding needed lots of work. Lots of rot and no soffit at all, which exposed all the ugly nails from the roof.

Roof was mostly ok. There was some patch work done and the original contractor who fixed this made no effort to match the shingles. Thinking that we were not going to be able to match them up well enough ourselves (due to weathering), I planned on painting the roof.

Back fence was damaged pretty good. Mostly from people in the neighborhood busting through the pickets and walking through to get to the shopping center on the other side.

Someone tried to make one of the rooms bigger by extending it into the bedroom. Unfortunately, their solution to removing the hallway was to have a passthrough in this room. This basically made this extended space worthless. 

Bathrooms and kitchen were in rough shape and we had to replace the cabinets in the kitchen.

Back patio was a failed attempt at something, not sure what though.

Everything else was pretty standard.

What was done:

Painted house inside and out.

Replaced flooring with new laminate, tile and carpet. In truth, we went over the existing tile and engineered hardwood in the living room, dining room and kitchen to save money. Luckily the flooring was pretty level and secure and this did not pose as a problem.

We moved around the closets in the extended room so we could completely close off the passthrough. This allowed for the room to truly be bigger and more functional.

Replaced the shower, vanity and lighting in the master bath and tiled the floor and shower.

Replaced the vanity and lighting and tiled the flower and shower. We also refinished the tub.

Opened up the wall between the living room and dining room area.

Repaired siding and added vinyl soffit.

Custom built shutters to match the rest of the house.

Made the patio into a nice space. Had to work with what was already there. I think we did alright though.

Fixed the fence. Later enclosed the fence at the buyers request.

Patched the room with the correct shingles. Barely noticeable unless you were standing in the neighbors yard and looking for it.



So this one worked out better than the last. The renovations ran over more than than expected as the nature of flipping houses tends to be, but not by much. In fact, this flip went relatively smooth despite it's late start. Problems didn't really begin until we started dealing with the buyers agent. In fact, she caused so many problems that I almost called off the deal on three separate occasions. Even to this day, I wan't to go to her buyers and tell them that they almost lost the house because of her . . . but of course, I wont do that.

She was incredibly unprofessional, she wouldn't answer her phone, most of her emails or texts. In fact, we actually had to get her and my agents BIC involved to save the deal and get things moving along. In the end, we found out that she didn't relay certain information to her buyers, which lead to more issues at closing. At closing the buyers said that they were not signing papers until everything was done on their due diligence repair list. This was after the buyers had been living there (the took early possession) for two weeks. Apparently, they were under the impression that we didn't do anything on the list. What had actually happened was that we repaired almost everything on the list, with the exception of a couple things that were just retarded. We sent back this list with our initials next to the crossed out items and waited for the buyers to initial and agree. We got no response for a week, despite emailing her, calling her and texting her. While we waited, we completed the list so that we would not hold up closing. Finally, my agent (per my instructions) emailed the the agent and told her to either have her buyers sign the due diligence list or take possession, which would automatically mark the end of their due diligence and acceptance of it's current condition. We also informed her that everything had been done on the list, save for the two items we crossed out. She finally responded back with telling us that they would be moving in the next day. Our guess is that she never communicated any of this information to her buyers, which is why they thought we never done the work. So at closing, I told my agent to tell the agent to have her buyers either sign the contract or get out of my house. From there, I don't really know what was said or done, but some how, we closed on the house. 

During this whole ordeal, I got the impression that this agent had an entitlement mentality and of course pushed this on to her buyers. I imagine that she told her buyers that house flippers make a lot of money and that they should try and get as much out of us as possible. She demanded that we install a fence and give the buyers $1000 for a washer and dryer and they absolutely would not budget from this.

When she did communicate with us, she had a nasty attitude and acted like we were the bad guys. Even when she sent the repair request, she told us that the house was in bad shape and that we basically just painted over everything. This of course was not true. She continued to say that the girl that was buying this house was a single pregnant woman and she didn't have anyone to fix these things, so we better take care of it. Of course, this was not exactly true, nor was it necessary to say. I did some snooping and found the buyer's Facebook page and found out that she was in fact single (as in not married) and had been knocked up by some guy that she had been dating for 2 months. Because of this, they were now planning on getting married in the summer. But of course the agent felt the need to manipulate the situation (And I don't do well with people who try to manipulate me) and lie about her status. But of course, even if that were true, that is not my problem --next time don't get knocked up by some guy you barely know . . . Anyways, prior to all this, I had already agreed to the fence (which wasn't much) and I finally agreed to the washer and dryer allowance, but not before having them cover some of the closing costs. Also, I absolutely have no problems with repairing necessary items on a due diligence repair list, so trying to manipulate me was was not necessary.

We later found out that we weren't the only people who have had issues with this particular agent, which is of no surprise to me. In fact, the contractor who installed the fence is still trying to get paid and the agent has been giving them the run around (which makes no sense, it's not like it is coming out of her pocket) and even went on vacation before sending them the check. I suggested that they go to the lawyers office who has the checks to get the situation resolved. Needless to say, we probably won't be accepting any offers from her in the future, unless we don't have any other offers in place. If we find ourselves in the position, we will probably contact her BIC and request that those buyers be represented by a different agent. 

Take aways:

Awkward shaped houses are ok if you can open up the areas and make the house overall more functional. We were able to do with Maize Ct. by busting down walls, adding a pantry and moving closets around in the bedrooms. However, this can be costly and sometimes not enough to make up for the awkwardness. With that being said, you will probably find a buyer (as long as it is not too bad), just expect it to take longer to sell and don't expect to sell it at a premium. I would also suggest not making a house like this one of your first flips. Doing so can hold you up from buying other houses if you don't have enough resources and it could force you to sell for lower than you want. But, if you have more inventory and you are consistently buying and selling, then buying a house that might sit on the market for a little longer is not such a big deal.

I didn't really go into this too much, but the only reason why we were able to not go over budget too much on 515 S Pine Cone is because we found areas where we could save money. However, repairing the siding on the house almost blew our budget out of the water because of how bad it was. The truth is, we should have just removed the rotten siding and vinyl sided the house instead. Luckily, we learned this lesson and did this on the next house. 

We continue to negotiate closing costs as often as we can. This definitely helps our bottom line. I remember reading somewhere to penalize the buyer each time they ask for a concession. This is basically what we do. For instance, if the buyer asks for a fence to be installed that will cost $1600, we ask them to cover 2k of the closing costs. So far, this has worked well for us. We of course start out by asking for some closing cost to be covered from the beginning.

Also, something I forgot to mention above is that we always try and push the comps and get another 5k profit out of each property when we sell. We don't bank on this of course. When we do our numbers, we base our numbers on the original comps and when we go to sell, we run the comps again and add 5k to the sales price. So far, we have not had any issues with appraisals coming back lower than this 5k bump.

Where we are now

Currently, we have 3 flips, one of which is on the market and the other two will be on the market in the next two weeks. We also have two houses under contract and are actively seeking two more. We are on track to flip at least 10 houses this year and we should make over 100k after all expenses and taxes. Next year, I should have enough resources to flip 4 to 5 houses every 3 months.


Updated almost 3 years ago

One other thing I forgot to mention about the renovations is that they are working out to be about $25 per square foot on average. Of course that goes up if you have to replace multiple expensive items like AC units, siding and roofs.

Updated almost 3 years ago

LINK TO PICTURES: Sorry, I had to redo the pictures folder on the drive. https://drive.google.com/drive/folders/1jFND3tqAuaNHkdyosEgzpNf7n2tDyteH?usp=sharing

Sounds like you learned quite a bit from just those 2 flips @Dean I. !  I like the closing cost strategies you have outlined here, I hadn't thought about that as an option and wish I did on my last sale.  I will remember that one next time.  ;)

Just an FYI, the pictures link doesn't let you view unless you have permission.  

Best of luck on your next 3 properties, can't wait to hear about those! 


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