First Home Flip

[Dakota Kistler]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $222,000
Cash invested: $70,000
Sale price: $366,000

Our first home purchase unexpectedly became our first fix-and-flip project. We bought the house in March 2021, benefiting from a low interest rate of nearly 3%, with the intention of making it our family home for years to come. However, since the last update to the house was over 20 years ago, it required a complete renovation. This major renovation project turned out to be the catalyst for our career in real estate.

What made you interested in investing in this type of deal?

The family's first home.

How did you find this deal and how did you negotiate it?

We discovered this deal through our real estate agent, who acted as a double agent. By keeping both the seller's and the buyers' interests in mind, the agent did an excellent job ensuring that the deal was fair and equitable for both parties.

How did you finance this deal?

Conventional 30-year loan with a 3% downpayment

How did you add value to the deal?

Every bedroom was updated with new paint, carpet, and wood trim around the windows, doors, and baseboards. We installed new ceiling fans and electrical fixtures as well. The kitchen was completely gutted and renovated, featuring a new open floor layout. In the dining room, we removed the old finishes and added three walls of shiplap, complemented by a striking black accent wall at one end. The half-finished basement was refinished with new carpet and paint, and we added a new bar for hosting.

What was the outcome?

Selling this house helped the family pay off high-interest debt, including student loans and credit cards, and provided a 20% down payment for their next home in a more desirable location.

Lessons learned? Challenges?

The most significant lesson learned here was recognizing when to outsource work and whom to hire. In one case, we engaged an epoxy contractor to refinish countertops and two concrete floors. The quality of the work was terrible, and the initial budget was exceeded.

A significant challenge encountered during the kitchen renovation was rewiring the stove and relocating the water lines for the refrigerator.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I became a licensed real estate agent while working on this project. I strongly recommend that anyone looking to buy or sell a property find a trustworthy real estate agent who is willing to go the extra mile, especially during challenging situations.