Fix and Flip

[Scott Allen]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $130,000
Cash invested: $19,000
Sale price: $286,000

Found this single-family through calling off-market in North Linden, a C+ Neighborhood of Columbus, OH. Negotiated the purchase price down about $20k while in contract after being able to see the inside. It was a 5bd/2bd house without a dining room. Turned it into a 4bd/2ba house with a dining room.

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

Wanted to see the transformation of a distressed single-family house into a turnkey single-family home for a home buyer.

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

I was cold-calling through the neighborhood looking for a rental to buy.

How did you finance this deal?

I used hard money to fund the purchase price and rehab cost of the property (downpayment was the equivalent of 10% interest only of the purchase price + rehab).

How did you add value to the deal?

Completely redid the house. It used to be a 5bd/2ba house with one of the bedrooms being very small and practically useless as a bedroom that could have been a dining room. Converted it into a 4bd/2ba house by taking out some of the walls to make a dining space near the kitchen.

What was the outcome?

Profited $58k after all out of pocket expenses (downpayment, rehab, holding cost).

Lessons learned? Challenges?

Learned the process of doing a fix and flip from timeline of start to finish. Studied popular trends during rehab of other successful flippers (paint scheme, floors, tile to use, look of kitchen and bathrooms).

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

I am a real estate agent, used a hard money lender for the purchase and rehab funds, used an insurance agent for builders insurance, used one of my trusted general contractors for the rehab, and used myself again for when listing the property in early spring.