Deal going bad

[Caryn Fischer]

I have invested in a house flip that has taken longer (18 months) and more expensive (100k over budget) than expected. It is done and has been listed with price reductions & changes in agents since March.

I am now at risk of losing my initial investment as are my partners.

What are the options?

I assume we could drop the price, take less of a loss and just sell.

Or we could pivot to STR, MTR, LTR and try and wait out the market.

Any other ideas from all of you seasoned investors? I’m sure I’m not the only one looking down the barrel these days…

Open to any advice…thank you.

[Chris Seveney]

Quote from @Caryn Fischer:

I have invested in a house flip that has taken longer (18 months) and more expensive (100k over budget) than expected. It is done and has been listed with price reductions & changes in agents since March.

I am now at risk of losing my initial investment as are my partners.

What are the options?

I assume we could drop the price, take less of a loss and just sell.

Or we could pivot to STR, MTR, LTR and try and wait out the market.

Any other ideas from all of you seasoned investors? I’m sure I’m not the only one looking down the barrel these days…

Open to any advice…thank you.

Did you pay cash for the property or take out financing? That makes a big difference. If you paid 100% cash, you may have more flexibility to ride it out, but even then, $100K over budget hits differently depending on the original purchase price. Losing $100K on a $1M house is one thing. Losing $100K on a $400K house is something else entirely.

Personally, if I was $100K underwater on a $400K project, I'd lean toward selling and taking the loss to free up capital and avoid additional carrying costs. If it's a higher-value property and you paid cash, you could explore holding it longer with an exit plan through STR, MTR, or LTR.

That said, before pivoting to a rental strategy, make sure you’re running real numbers andnot just break-even, but true cash flow after all expenses. Also factor in lease-up time, seasonality, local regulations, and the cost of converting to a compliant rental if needed.

Ultimately, your next step depends on your capital stack, cash flow needs, and your long-term investment goals. What’s your basis, and are you willing to hold another 12–24 months if the market doesn’t bounce quickly?