First Flip Journey in Colorado, Colorado Springs region
Hello Bigger Pockets community!! I have been meaning to do this post for awhile, but been so busy!! Anyway, we (hubs and I) got our first flip house and we closed on it on December 29th of last year. We found the house off market, by accident kind of. This really was a deal landing in the lap instance. We knew the people living in the house and they were in a rent to own deal when the owner, who happens to be a big real estate investor guru type, got in trouble for running a Ponzi scheme with his properties. The bankruptcy court forced him to put all his properties under one entity and then file bankruptcy. So I contacted the attorney and we worked out a great deal.
We have literally started our business because of this house. We are now Triple R Home Buyers! So the house is a 3 bed 2 bath, 1224sf, .38 acres in a very nice area of our little town of Woodland Park. Within walking distance of schools and downtown. We got it for 117K, with an ARV of 245K (which we now are feeling like we'll list for 260K, based on market and low inventory in our area). The renovation costs we budgeted were 45K. But we are actually tracking to come in more like 55K. That is due to my inexperience dealing with contractors, who I did not vet nearly good enough. They are doing ok, but lots of things she didn't put on her bid, and I have nearly no renovation experience, so I missed it. Boy have we learned A LOT!!!! Not only that, but I waited to check out references, and turns out they have stolen from several other investors. So it's been a journey with them. Having to be very, very cautious with paperwork and tracking payments and have had to really be on them to keep things moving swiftly. That is a whole other thread in and of itself. I will be doing things very differently on the next deal, for sure!
Anyway, I've basically had to learn everything as I've gone, and Bigger Pockets has been a God send! As I was putting together SOW, running numbers, looking for financing, learning about title, all of it, I have had to learn as I go. We went with a hard money lender, which in my opinion has been totally worth the 14%, 4 points. They have been so easy to work with. They loaned 70%LTV, and it covered to buy the house and the 45K in renovations. I am hoping on our next deal they will come down on interest a bit.
Ok, so here's what the house looked like before we bought it:
So far, we have painted the exterior, all new vinyl windows, new exterior doors, new garage door and opener, installing French drains and a sump pump due to there being a bad ground water issue in the crawl space last spring, new roof, opened up the kitchen, put in a french door, replaced all the wood flooring, tiled in bathrooms, framed in laundry and mechanical, shelves in the pantry, all new interior paint, heated flooring in master bath, can lighting. Basically the whole things was a gut, all baths and kitchen and flooring out. We took down some awful paneling in the living room as well, so some new drywall. Sorry about the sideways pics. Can't seem to rotate them. I will get more pics today also as we have been too busy to capture as much of the process as I'd like. We decided to do a lot of the work on this first house as we want to learn, but it is very arduous when we both also work full time jobs. Long days!!
Here are some improvements:
Thought I would share this process with everyone who is interested! We have made a deadline for March 3rd to done. LOTS to do in the next 2 weeks, but I'll post more throughout!!