First Rehab Completed and Sold

21 Replies

First I want to thank everybody on this board for all the knowledge shared every day, as it has been a big help thus far. I spend more time lurking on BP than contributing, which is something I plan to change.

I sort of hit it out of the park on this deal, which I mostly contribute to luck and good timing of the local RE market.

Purchased 10/1/11 110K
Purchase Costs ~2K
Rehab and holding costs ~90K
Selling Costs ~20K
Sold 4/30/12 334K

We had a full price offer the first day on the market and closed less than a month later.

The project was bout off the MLS as a REO that was in the "middle" of a dining room and 2nd story addition. I had an equity partner in on the deal so profits were split 50/50, I also "saved" 15K-20K by doing some work myself, which I will try to limit on future deals.

The project took a little longer than anticipated mainly due to my lack of experience dealing with the county and building inspectors. Permits took a month to get after closing, and the fact that I did some work didn't help the timeline either.

Before and after pictures can be seen here:
[url]http://www.flickr.com/photos/ryan_rei/sets/

Thanks James and Mike

The scope of the project was more than I had in mind in pursing my first deal. I was originally looking at cosmetic rehabs, but after making many rejected offers I came upon this one and I couldn't be more pleased with the final product.

Ryan

Originally posted by Daniel O.:
Congratulations Ryan!! very inspiring!

can you please elaborate on the selling costs and holding costs??

Selling costs broke down as follows:
RE Commisions $16,700
Realtor Admin Fee $345
Title Insurance $1,703
Transfer Taxes $501
Update Survey $250
Attorney $450

The holding costs were:
Property Taxes $1825
Insurance $1453
Utilities ~$800

Ryan

Congrats Ryan! I too am doing a lot of the work on my first rehab. For me, every project seems to take a heck of a lot longer than I anticipated. I'll blame it on being new though.

Hope you come across more deals like this one!

I can see why it sold in one day. Great Job!!!

I'm curious, at the time you started the rehab project, did you know the house would sell for $330K or was the market different 5 months ago?

Originally posted by Larry Sarner:
Well done Ryan! How did you find an equity partner?

The equity partner was a family member. It took some convincing to get him interested in the deal, but after seeing the results he can't wait for the next one.

Originally posted by David B.:
I can see why it sold in one day. Great Job!!!

I'm curious, at the time you started the rehab project, did you know the house would sell for $330K or was the market different 5 months ago?

Thanks David

To answer your question, no I did not think I would get 330K 5 months ago. I believe a few things contributed to the upside surprise.

1: When I comped out the property before purchasing there were not very many good comps in the area. Properties were either much bigger with higher sales prices or smaller and distressed with lower sales prices. I went conservative and figured a $285K sales price.

2: We made some upgrades in the property that increased the appeal, but did not cost much. The most important one being finishing the basement.

3: The house went on the market at the perfect time, the spring sales season in my area has been very good with many buyers chasing a few attractive properties. This one being one of the nicest, and right at the median sales price for the area.

4: Beginners luck

Originally posted by David B.:
I can see why it sold in one day. Great Job!!!

I'm curious, at the time you started the rehab project, did you know the house would sell for $330K or was the market different 5 months ago?

Ryan, I'm curious on this as well.

Great numbers... but can you give us a breakout of what your budget was for the repair and what your anticipated ARV was when you bought it? End results are great, but some times the deltas tell a story as well!

Originally posted by Nathan Emmert:

Ryan, I'm curious on this as well.

Great numbers... but can you give us a breakout of what your budget was for the repair and what your anticipated ARV was when you bought it? End results are great, but some times the deltas tell a story as well!

My original ARV was $285K and I budgeted ~$87K for the repairs. We saved some money in places, but increased the scope a little along the way.

When it was all said and done the repairs came in at ~$85K

Congratulations! It came out great. Your floors are beautiful, paint job looks great, tile is fantastic and the outside ozzes with charm! My only suggestion would be on the next one, keep your style consistent, such as color and style of cabinets. Other than that... perfect!

The reason I asked was that in some areas in the last 5-10 months, the price on SFH has risen up to 20%. Jobs have been rebounding and investor demand for SFH has been strong, thus the rise in prices.

Also, your first deal was a project where you were essentially doing a gut rehab without the demo. All the eperience you received is valuable for deals going forward. Awesome!!! Great project to start out on and learn from and you hit a grand slam. Nice..very nice.

I'm new to this BP and this is a stupid ?, so what does ARV stand for?

Originally posted by Karen M.:
Congratulations! It came out great. Your floors are beautiful, paint job looks great, tile is fantastic and the outside ozzes with charm! My only suggestion would be on the next one, keep your style consistent, such as color and style of cabinets. Other than that... perfect!

Thanks Karen,
When you say I should keep my style constant are you referring to the fact I used two different style and color cabinets for the kitchen and bathrooms. Or that that the cabinet style does not match the rest of the house.

Design is not one of my strong points so any feedback is much appreciated.

WOOOWWW!!!! Amazing job @Ryan O.!!! I think I'm going to steal your style for the bathrooms when my first one comes around!!! You did awesome! I'm super happy for you!!!

Great job Ryan!

Quick question on your COMP. You had mention you thought the property is worth about 285K, is the property you sold a track home?

Here where I live, every home seems to be in a track home with an HOA and are all relativity close in price range, so getting COMP's are much easier than other places I hear about where one home is worth $100k, and you're neighbor across the street could have a $400k home.

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