Worst FIRST FLIP: LOST OVER 100k

106 Replies

Originally posted by @Alex Jones :

@KIran Kaur

Electricity and plumbing? There is a problems with both for just not fixed accurately or? I ask because I’m about to finish my first flip house by the end of this month. I have had work with various contractors and some come and go. What was the issue with electricity and plumbing? You also just remind me about smoke detectors and stairs handler for basement, backyard and front door steps. It easily little details can be overlooked by rookie like myself and you.

IDK what he did but literally our whole house was leaking...literally everywhere. AT this point i think he did it on purpose. 

Wires were ripped out and none of the outlets or lights worked. Don't forget to cover the water heater lol 

 

Originally posted by @Joaquin M Dugan Jr :

How did you find this contractor if you dont mind me asking and what caused you to select them over any other contractor?

He was recommended by a "friend" in real estate, cheaper, fake photos of his work, fake references, and a sweet talker. FOOLED US FOR SURE. Like I said before, it was his bad for fooling us and our bad for letting him. Man made his money and ran... we ended up learning lol.

Originally posted by @KIran Kaur :
Originally posted by @Joaquin M Dugan Jr:

How did you find this contractor if you dont mind me asking and what caused you to select them over any other contractor?

 He was recommended by a "friend" in real estate, cheaper, fake photos of his work, fake references, and a sweet talker. FOOLED US FOR SURE. Like I said before, it was his bad for fooling us and our bad for letting him. Man made his money and ran... we ended up learning lol. 


Wow, I'm sorry to hear that had happened to you. Yet, am glad it was a learning lesson and you're back on your feet and ready to flip again. Duly noted, all your friends aren't your friends lol

 

Originally posted by @Shanice Waller :

@KIran Kaur to see you’re not giving up is so encouraging. I’ve made quite a few unwise decisions turning a property too. These lessons you learned will serve you. Best wishes in your next investments! Do

Thank you :) Hopefully you're doing great now! 

 

Originally posted by @Rik Patel :

@KIran Kaur What was it like working with myhousedeals? Never knew they even existed! Would love to know your experience.

It was a random find .. I have had that membership for over a year now- no luck finding anything properties. I am actually looking for other avenues to find flip.. been cold calling to see if anything's going to work. Do you have any suggestions? 

 

@KIran Kaur

I'm a contractor and I'm sorry you had to go through this. These pictures tell me that this person had zero clue what they were doing. Items like the casing cut around the base molding actually took more effort to do it wrong then do it right.

I will say that during site visits you should have seen the work was not looking correct and should have stopped it at that moment before it got carried away.

Try and familiarize yourself with as much of the construction rehab process as you can. It will be of tremendous help going forward.

Originally posted by @Erik B. :

@KIran Kaur

I'm a contractor and I'm sorry you had to go through this. These pictures tell me that this person had zero clue what they were doing. Items like the casing cut around the base molding actually took more effort to do it wrong then do it right.

I will say that during site visits you should have seen the work was not looking correct and should have stopped it at that moment before it got carried away.

Try and familiarize yourself with as much of the construction rehab process as you can. It will be of tremendous help going forward.

 You're absolutely right! You wouldn't believe the amount of times I have looked at these photos and thought what kind of idiot allows this to continue... it was a rookie mistake. 

I can so relate to this huge flip loss due to an unlicensed contractor (that my business partner hired!!) I hope you report him to the CSLB which is what I did but its been a slow moving process especially with Covid going on. It is currently in the Superior Court system and I've filed a claim but dont know if I'll ever see any money back. I just dont want anyone else to be taken advantage by this jerk. Hope you file a claim.

I am sorry that happened.  I am glad that make you want to quit and you still understand the power of Real Estate!!  I agree learning how to do things yourself (even if you don't do them) will help you see what is going on and make you ask questions if it doesn't look right.  You can learn so much from BP and YouTube.

@KIran Kaur by the way this was a terrible idea even without the contractors ripping you off,

Sale price 415K -5% -5K back end closing -50K rehab -5K front end closing -350K = -16K

My house deals is not really a place to find discounted property’s (they make the

Money from the advertisements)

Sorry for you loose. 

@David Lichtenstadter

Arv for that house was 550k -570k

Rehab was supposed be 50k total including labor and materials.

Holding was supposed to be 6-8k

550k x 5% = 27500

Loan costs : none because I have my license..

Total cost = $85,500

Even if we sold at 550k and

If the contractor didn’t mess up our stuff and delay our sale we could have made $94,500

550k-370k-$85,500= $94,500

It was a great buy with great comps. 3 month hold turned into 8 or 9 months ..

Still a win for you, paying for your education from the School of Hard Knocks. I'd be willing to bet that 99% of us on here can share a similar learning experience. Good luck on the next one, you'll do great with it. Cheers!

That is my greatest fear is trusting a contractor. Unfortunately, my job requires a lot of my time so I wouldn't be able to stay on top of a contractor and make sure things are being done correctly.

Originally posted by @KIran Kaur :

@Juan Pardo

We renovated .. he just ruined our material so the house was in worst condition than when we bought. Nothing was working from plumbing to electricity. Idk how he messed up the electricity. I’ll add photos for reference

 I see.. I was wondering if, in your local market, you could have flipped the property "as is" without doing any rehab. Is it possible to make money using that strategy?

@Walter Cuthbertson stick to the Formula it never failed me this far also do not go outside your budget and pick two or three GC’s that you feel comfortable with that’s a big deal in the flipping real estate game.

@KIran Kaur . Do you think you would have caught on to those issues earlier if you had been there on site to supervise and inspect the progress regulalrly? Good to see you are able to bounce back. It’s easy to see the power of your resilience. Lots of people would never recover emotionally from this.

Wow, huge financial loss but the knowledge you gained from

that loss must’ve been far more. You must know most of the ins and outs now about how to rehab “properly” lol. I feel like you’d be better off getting an off market property for a flip

Can you be more specific about your contractor, and what went wrong?

A license does not prove proficiency or quality. 

As well, I am interested to know if the work was done under permits.

Thanks!

Wow, looking at those pictures I think that "contractor"is the worst I've seen. Sorry that didn't work out for you but glad you are still looking to proceed again.

myhousedeals isn't really a deal. I had an listing before and they reached out to me to see if they could advertise my listing on they're site. I told them it wasn't a good deal for flippers as margins were too slim so they exaggerated the arv.

Lastly, you still could have probably sold the home on the MLS. Sacramento has thousands of eager investors looking for a deal. If arv was North of $550k I'm sure someone would have bought it for $450-475k.

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