Single-family residence other investment in Norfolk.
Purchase price: $147,800
Cash invested: $3,000
This is a house hacking situation where I'm living and flipping, while rooming with my friends. Additionally, I am working on selling a lot that came with the property, in order to finance my next deal an rehab on this property. The goal is to use this property to build cash, while moving the property towards a cash flowing rental at the same time.
Sold a lot on the property for $60,500 and financing the flip with cash from the sale, while still house-hacking & refinanced into a better loan, with a lower interest rate, principal value & monthly payment while eradicating PMI.
What made you interested in investing in this type of deal?
It was my first one and originally an off-market deal.
How did you find this deal and how did you negotiate it?
I found it through a real estate agent that was affiliated with the community via the Civic League. I simply waited for the deal to hit the market and the price to naturally drop since it was very evidently overpriced.
Once I came back to the deal, I negotiated a new power panel to be installed, to upgrade to 200 amp service, and then I offered to take the property, as-is, given the price was dropped down to $150k from $160k, so I had a little more room for error on learning with this property.
How did you finance this deal?
Originally, it was an FHA VHDA 30 Year mortgage at 4.25% w/ 1% down. I actually wrote off a laptop purchase for school and used the tax refund money to purchase the house, which recycled the same cash instead of me bringing any of my personal cash into the deal.
How did you add value to the deal?
I tore down some load bearing walls to open up the kitchen, added HVAC upstairs (no previous ducts or ventilation), demolished part of the garage to subdivide & sell of the lot in the backyard, and redoing all of the bathrooms/ceilings/paint textures/landscape in the entirety.
What was the outcome?
This is still in the works. So far, everything has been only $3k over budget.
Lessons learned? Challenges?
SHOP FOR LOANS. Also, be sure to vet & interview agents thoroughly.
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