Investor · Raleigh, NC · Member since 2013 · 348 posts · 128 votes
Here we are finally done with my first rehab. I started back around the middle of August and 3 months and one massive act of vandalism later we are at the finish line! Please feel free to ask questions and make comments about the pictures below. I really enjoy answering questions and helping out in any way I can. Enjoy!
Real Estate Investor · atlanta, GA · Member since 2013 · 456 posts · 237 votes
12y
Great job on the remodel Jacob - I wish I had caught this posting earlier. You do really nice work and obviously take a ton of pride in your renovations and the home you are presenting for sale. You need to point that out in your marketing efforts. I've flipped more houses than most over the years but what works for me might not work for you:
The agent who can help you find & negotiate the deal on a purchase isn't necessarily the best person for the job on the sale. Agents often think they are somehow entitled to the commission on the other end of the deal if they helped you buy it. Figure out in advance who the "hot" listing agent is in the market you are buying the next house in and interview them for the listing....even in advance. Chat with them about your plans and get some input as to what you should be doing to make it sell for max price. You don't have to listen to them but it's good to hear what they have to say in advance. I have some agents in east cobb who sell everything they touch at great prices...not always market max...they actually sold one recently before it even was listed. Find those kinds of agents and don't be afraid to split the deal
I wouldn't have lowered the price at all...at least not when you did. I would have cut my listing agents commission back some and ramped up the selling agent's commission to 5%. Agents are commission driven and the more you pay, the more attention you'll get...and they'll be lining up to see you next project.
Shoot a great marketing video of the property and get it online ASAP. I am involved in several companies and video marketing is key to what we do and our success. Check with the local colleges and see if they have a video/media program and see if they will work with you on internship or cheap basis...be they will. Youtube is great...but it has to be a good video. If you feel comfortable, get in front of the camera and explain the salient points of what you've done with the house. No one knows that house better than you and your contractor...I'm sure you are doing some of the work so advertise that. Once you have the video you can post the link EVERYWHERE....put a note in it that you buy houses. CL isn't the place to sell your house...though it might a great place to buy. Post it there but just accept the low baller tirekickers that come from it. With my renters, less than 5% come from CL...the rest are from other sources.
If you're going to keep doing this, get with a great local printer and have a nice postcard size marketing piece done...front & back. Set up the standard one side to be all about you, your philosophy and the "why should I buy from this guy?" Remember back when you bought your first home....the anxiety....the unknowns...speak to that...you have an honest face...use it in your marketing. Get known in your market as the "yes..you'll pay a little bit more but I'm worth it" investor. Also put a note on there somewhere that you BUY houses... I like making things do double duty so get the most out of your $$ and efforts.
Once you have the card set up - use it for each property. Take it door-to-door in a 1/4 mile radius around the property and try to meet some of the folks in your neighborhood. Don't knock on doors....and don't leave it in the mailbox as that's actually against the law....leave it in their front door. You'll have your neighbors marketing for you and you just never know...a visitor might see your card, catch the sexy shower and want to buy it. The card got the ball rolling...not your agent. There is always a hidden market for buyers...just like the one we try to find for sellers.
Raleigh is a big IT town with more men than women. Market the house as a 4bedroom from the get-go...if it has a window & a closet and meets basic space requirement...it's a bedroom. It's also the perfect man cave for someone with a family...it's also, more importantly....the perfect home office for someone who works from home. Marketing is all about finding your niche or creating it;
Lastly, if you are going to keep doing this....reach out to the HR departments of leading and mid-size firms in your area....same with recruiters. The larger firms will have contracts with real estate relocation firms...ask who you need to speak with and let them know about your house and future projects. I know quite a few HR people and recruiters and networking with them brings me business.
Congrats on the house.....hope some of this helps for the next one! happy Investing!
Investor · Raleigh, NC · Member since 2013 · 348 posts · 128 votes
12y
Update: We are scheduled to close on Monday the 28th in a couple of days! We spoke to the buyers agent and everything is a go. Hoping these last few days continue to be uneventful and I can have some numbers for this deal posted Monday evening.
Update: We are scheduled to close on Monday the 28th in a couple of days! We spoke to the buyers agent and everything is a go. Hoping these last few days continue to be uneventful and I can have some numbers for this deal posted Monday evening.
Congrats! Looking forward to an update and the final numbers. Thanks so much for all the sharing. It's been great to follow along on this one.
Duplex Investor · Coolidge, AZ · Member since 2013 · 34 posts · 8 votes
12y
Congrats...you did a very good job on this property. I enjoy seeing the before and after picture to rehabs.....it shows the potential as well as inspire me to stay focus on my dreams of become wealthy...
Investor · Arlington, VA · Member since 2012 · 84 posts · 27 votes
12y
@Jacob A. Great thread! You've documented your experience incredibly well.
Getting the first flip out of the way has more rewards than just the financial aspect of it. Just think about how much knowledge you have acquired along the way! Without a doubt, your REI IQ has skyrocketed. ;) The end product looks fantastic and the modern touches revitalized the home.
@Account Closed I also believe the home would have been more appealing if it had a car garage. Besides the car garage, I would have hooked the home to city water from the start.
My first flip was my primary residence. Looking back, I actually lost a bit of money in the end as I over fixed it. However, it was all worth it and the experience was very rewarding. When the time is right, I will try it again.
All in all, great job. Sending some closing dust your way.
Investor · Lewisville, NC · Member since 2014 · 25 posts · 3 votes
12y
@Jacob A. Thanks so much for sharing your journey with everyone! Stellar job on the house. I'm keeping my fingers crossed for you tomorrow - you've definitely been put through it on this one. We're looking at purchasing our first flip in the W-S area, and the biggest thing I've learned around here is the market is dead from like Nov-Jan, and it was even worse with the weather this past winter.
Investor · Raleigh, NC · Member since 2013 · 348 posts · 128 votes
12y
We are done! Closed this morning and here are the long awaited final numbers on this one:
Purchase Price: $51,500
Closing costs (on purchase): $1,222.66
Payments to contractor: $63,891.57 (original budget $59,000)
Interest payments on LOC: $2,248.11
Property Insurance: $828.00
Utilities: $976.74
Cleaning: $150.00
Appliances: $2,503.72
Staging: $1,300.00 (Includes two $150/month payments with the original $1,000 fee)
City water hookup: $8,176.00
Closing costs (on sale): $11,097.40 (Commissions, $3,000 in seller concessions, taxes, etc.)
Total Investment: $143,894.20
Sales Price: $154,900.00
Profit: $11,005.80
Time on market: Roughly 115 days (thanks winter)
Total time from close to close: Right at 7 months
There it is, for better or for worse. I'm sure there will be those of you out there that are going to pick every number apart and I'm happy to answer any questions or take any constructive criticism. We didn't really come out as ideally as I had hoped but I still consider this a great success for my first flip and for such a large rehab. Adding on the city water at the end for a buyer that ultimately got cold feet was the biggest budget hit that we took. As you can see between the city costs and the payment to my plumber to get everything rigged up for that nearly cost us 10 grand of profit. Like I said, I got paid $11,005.80 to get an education and as far as I'm concerned you can't beat that. We will take that money and move on to number two as I've already got my eyes on a couple of potential deals. Biggest lesson learned: the winter market and the spring/summer markets are two completely different beasts. Try to avoid the winter markets at all costs if you can.
Real Estate Broker · Triangle Area, NC · Member since 2012 · 587 posts · 214 votes
12y
Woohoo!! Finally got that thing sold! The fact that you made anything at all is good news. I'm sure many first timers end up taking a loss. Thanks for sharing the journey and I'm looking forward to #2!
Investor · Raleigh, NC · Member since 2013 · 348 posts · 128 votes
12y
@Dave Meadows I'll be jumping into #2 as soon as I can find something worthwhile. I closed this morning and was looking at a house with my contractor this afternoon!
Smithfield, NC · Member since 2014 · 5 posts · 1 vote
12y
Congrats. I just joined BP and found your post about a week ago. I'm very glad to hear there was a good ending after the delay. We'd be ecstatic to come out with $11,000 profit on our first venture. Starting off, it's all about the learning experience for us.
My family is looking to start investing just south of Raleigh (Clayton, Smithfield, Goldsboro) next fall. I appreciate the advice about winter markets.
Would love to hear more about your adventures in Raleigh real estate in the coming months.
Like I said, I got paid $11,005.80 to get an education and as far as Im concerned you can't beat that. We will take that money and move on to number two as I've already got my eyes on a couple of potential deals. Biggest lesson learned: the winter market and the spring/summer markets are two completely different beasts. Try to avoid the winter markets at all costs if you can.
Congrats! $11K to learn all that you learned on this one is excellent.
That was the deal I made with myself on my very first investment (a tax sale property). I told myself that as long as I didn't lose any money I would consider it a success. You did way better than not losing any money.
Thanks so much for starting this thread and keeping us updated. On to the next one!
as I read down the list and I hit the city sewer connect I thought "awe geez! he got hit hard, there's no way he made a profit"..... but then to see that you went through all you did and held on for 7 months and still came out with a paid education is wonderful and encouraging for the rest of us newbies.
Really appreciate you taking the time to keep us apprised of your progress and so quickly about your outcome... Thank You!!
Milwaukee, WI · Member since 2013 · 1 post · 0 votes
12y
Congratulations! I love happy endings. Thanks for sharing your experiences. You have inspired me (and many others, I suspect!). I am so glad things worked out for you and that you were able to close today.
There it is, for better or for worse. I'm sure there will be those of you out there that are going to pick every number apart and I'm happy to answer any questions or take any constructive criticism. We didn't really come out as ideally as I had hoped but I still consider this a great success for my first flip and for such a large rehab.
Investor · Raleigh, NC · Member since 2013 · 348 posts · 128 votes
12y
Thanks for the kind words everybody! It was certainly an exciting day and process and I hope my experiences have helped out in some way for the BP community.