Investor · Farmington, UT · Member since 2011 · 314 posts · 179 votes
What's up BP Nation? I flipped my first ever burned out "Firehouse" a few months ago and it turned out pretty well. $52,069 in profit. This story has a few interesting twists and take aways as well. One of my key take aways was NEVER to make a blind offer to a motivated seller.... ask me how I know. :( I almost missed out on this deal entirely!!
True to form, I made a video of this story for my Vlog. It's 7 minutes long and I'd love to hear your comments.
Involved In Real Estate · Richlands, NC · Member since 2015 · 12 posts · 4 votes
11y
@Andy M. First thing, great video and congratulations on your first deal. I have been in real estate investment for a while, and I have not done a flip yet. Your story and video is encouraging. Thank you for sharing.
Investor · Farmington, UT · Member since 2011 · 314 posts · 179 votes
11y
@Brandon Johnson & @Robert Swingle A big thanks to both of you guys for checking out my other videos as well. Robert, thanks for the kind words about my "from the trenches" videos. I'm not really worried about the number of views at this point because I know that as I keep pumping out quality videos the views will come. Content first right? That said, I'll keep putting out the quality videos, and you keep sharing them with your friends. Deal? :)
Real Estate Investor · Lancaster, TX · Member since 2015 · 2 posts · 0 votes
11y
Congrats!
I remember rehabbing my first "Burn Out" It was a 3 year old 4,400 sqft home that a homeowner tried to burn down due to a dispute with the builder. There was nothing left but studs and the brick façade. No plumbing, electrical, windows, fixtures or mechanicals.
ARV was $295k. The bank was only accepting cash offers so I offered $72k, but ended up paying $76k cash, which is nearly all I had...ouch!!! Nonetheless, I was nervous that it would take too long to get permits and what additional hoops I would have to jump through to even start the rehab.
While going through the permit process, I began the process of securing funds for the rehab. I ended up having to settle for a hard money loan since the banks wouldn't fund the deal. I borrowed $80k @ 14% with 2 points + closing. The lender seems extremely motivated to fund the deal; I could sense him licking his chops in hopes that I would default so that he could have a nice property to sell. Needless to say, I was very motivated to get this property fixed and flipped.
A week before I closed the hard money loan, the permits came through without much of an issue. I hired crews and went in full fledged and finished the rehab in 48 days. Everything went pretty smoothly; no major hits to the budget. Only went over $6k due to upgrading the mechanicals to a higher seer rating.
I received a contract a week after I finished and closed the sale 5 weeks later for $278k and after it paying off the hard money loan and closing costs I pocketed $53,359.
I feel that this was a lucky first burn out deal. I can say that I had never used hard money and probably won't use it again due to the cost associated, but I am glad I took the chance with this one.
Investor · Farmington, UT · Member since 2011 · 314 posts · 179 votes
11y
@Mike Fisher That is awesome!! Sounds like you had a good experience with your fire house as well. :)
@Karen Weichold Lol. Well done. ;) I actually have a full time project manager who acts as the GC on my projects. He works with the same subs on most of our projects so I'm sure that helps with the costs. I also give him a bonus if he comes in under budget.
Investor · Riverside, CA · Member since 2014 · 351 posts · 220 votes
11y
Good job man... nice when your good to a good person and good happens. Sorry for all the good speak but what goes around comes around. The video was great, tell me I have never done a burn out deal. What was your big unexpected incounter on the burn out.
Good job man... nice when your good to a good person and good happens. Sorry for all the good speak but what goes around comes around. The video was great, tell me I have never done a burn out deal. What was your big unexpected incounter on the burn out.
Investor · Farmington, UT · Member since 2011 · 314 posts · 179 votes
11y
@Jim Keller Hey Jim, to answer your question.. the biggest "unexpected" was that all of the pipes were cracked! The house was vacant and sat open to the elements for 8 months in Utah and it was over the winter. We had to fix a section of broken pipe, then find the next leak, then the next. It was crazy for a little bit! :)
I've learned in the years of rehab to expect the unexpected. Nothing really goes as planned but you just roll with the punches and stuff works out generally. Just don't let it stop you from taking action. Fear really stops most people from even trying.
Thanks for the positive comments about the video. :)