$41,583 Flip Profit after 5 months!
We wholetaled this house in October for a profit of exactly $41,583!
The property came off of a direct mail campaign to a seniors with equity list purchased from List Source. We targeted SFR properties with 35-100% equity in A-class areas of Indianapolis.
The seller called into the answering service back in July and these were their notes:
"Owner-occupied
4bd 2.5ba
finished basement
roof was put on in 2011
no updates have been done to kitchen and baths
fireplace
sunroom
2 car attached garage
she is wanting to relocate
wanting to sell asap
thinking around 270k as asking price
appt booked June 14th @ 5pm"
They booked an appointment for my acquisition manager to run the appointment based on his availability in our CRM. Here are the pictures from his initial appointment.
https://photos.google.com/share/AF1QipOz6y-IR7WewidBfFc19jJBToffpgHwvO_8gxqjkFnzebnymdwWLf1_wjgDu87ZGA?key=S1lkU21LbUltTUFkUTREMW40a0pBTkhGcEZjZThn
When you run an appointment take TONS of pictures.
Our Initial Notes:
"Man that house is FINE. Really doesn't need a whole lot. For someone to flip this thing you would want new appliances (3k), carpet in the bedrooms (4k), HVAC (6k), paint (8), misc (4k) = $25k.
We can call ARV around the 285-290 mark for a pretty solid deal.
ARV = 290k
75% = 218k
rehab = 25k
Could probably wholetale at like 240-250? - without touching a thing."
We initially told the seller that we weren't a good fit for her and that she should just list on the MLS. She had some health issues and didn't want to have to deal with any cleanup/repairs. After some back and forth we agreed to $205,000 as-is/cash.
Funding the deal: We paid one of our private lenders 9% interest to fund the purchase and a small rehab budget of $10,000 for an all-in cost of $215,000.
Repairs: There are deals where you can spend 10k or 30k and your profit margin doesn't really increase just the sales price. This was one of those... We replaced a furnace, did a deep clean, and had professional photos done.
Time: This deal took five months from the initial call to us getting paid. The biggest issue was that the seller wanted around 2 months to get her stuff out. We were under contract waiting to close for a little over 2 months.
Selling: We sold to a cash buyer off the MLS and were paid in right at 30 days from the time we listed. The buyer was an investor (surprisingly) who owned another SFR in the same neighborhood. I really don't see how he's cashflowing so it must be an appreciation play for him. We took a cash offer of $265,000 and ended up netting right at $41,583 when it was all said and done.
I guess that stuff doesn't have to look HGTV sexy to make massive profits. When I started out on BP (SEVERAL years back) I made less than 22k a year pre-tax. Super grateful for this community.