Closing on first flip, 2nd flip under contract - Chicago land area Dupage county

Closing on first flip, 2nd flip under contract - Chicago land area Dupage county

Investor · Madison, WI · Member since 2015 · 128 posts · 33 votes

Hello to all!  ....It's lengthy

#Biggerpockets has been an awesome resource for me for the last few months while getting into REI.

When I sign up on a forum (any forum) I get really hyped up on how I am going to be active and contribute and so on. Well I have consistently NOT done that. I'm more of a lurker who chimes in once in awhile. I'm learning the more active i am in this business (Not just BP but the entire real estate realm) the more I get in return...as in return of knowledge, contacts, network, friends, wisdom. 

So to kick things off, of me attempting to be more active...

With Jack n Coke at my side, I am starting a success story thread of my first 2 properties..lets start from the beginning...

January 4, 2015: Currently living in Wisconsin with intentions to flip properties in the Chicago land area. Find a property on the mls (reo) in Westmont, IL (suburb of). I like the deal and think it will be great (lol @ me). Asking $155,000. After a lot of back and forth, offer accepted at $136,000. On the side I get wind of this thing called 'wholesaling' through this site. I met with a wholesaler and agreed on a price for a suburban home of his located in Aurora, IL.

January 21, 2015-Back to the land of my birth! Chicago!! (I really love this city if you couldnt tell)  I move in with my sister who has a vacant room in her condo in Lombard, IL. 

At this point I have the Westmont condo under contract as well as the Aurora home under contract. I will keep the Aurora story short. I was hyped up looking at the number presented to my by the wholesaler. Once I got a few contractors in there i saw the SOW was 2x the wholesaler estimation.  Backed out, that deal was dead.

I started looking for another property and again through the MLS my agent found a townhouse (reo) in Glendale Heights that seemed promising. Well after the offer was accepted the closing process was seamless! Went very smooth. I was able to find, offer, close on this one before the westmont condo even had a solid closing date.

Townhouse-

2 Bed 2.5 Bath 1200sq ft
Asking 99.9k
Accepted 100.5k

walkthrough: https://www.youtube.com/watch?v=mgTS2F0p3KU

This checked off everything I was looking for in my first flip. Easy, simple, mostly cosmetic. I'm pretty handy myself so this one looked like one I could pretty much take on my self. I know down the road I wont be doing it my self but sometimes I like learning the hard way, I think it gives you wisdom in that particular field to have gone through it. 

After about 4 weeks of grinding I was ready to list the property. The only work I contracted out was the flooring. The tiles in the bathroom and the flooring on the 1st level was done by a single person in about a week. Good guy, I like him. 

So at this point I bought it for 100,500. Invested around 15,000 into it. (Not all 15k was into it, a good amount was for first time purchase of tools like wrenches, saws, power tools ect)

All in: $115,500
Listing price $159,900
Accepted: $149,000 with the terms of offering a home warranty and changing out the fogged glass in the sliding door. -$1,500

So $147,500-$115,500=$32,000- all other expenses/commissions/holding = I will be making around $19,000 more or less on this one. Which I am very proud of..being my first flip. Closing was set for this Friday but moved to Wednesday. Either way Im getting paid. Here are the listing photos..

So that was listed early April 2015 and was under contract in the last week of April.



Sure enough the Westmont Condo finally closed as soon as that one was listed so it was really a 1-2 punch. The condo from what I learned was vacant since 2011 and was occupied by a heavy heavy heavy heavy smoker. Like no joke, walls, ceiling, tile ground, cabinets, everything was smoke stained yellow. But whatever, gotta do what ya gotta do.

The financing for the condo was through a private lender who agreed to the terms of they pay for everything and when I sell they get the principal plus 50% of the profits. 

Accepted price was 136k but assesments and fees and all that came to $140,000

It was a quick cosmetic flip like the townhouse and this one even needed less! Only $10,000 invested. So im all in for $150,000

2Bed 2Bath 1400Sqft (I think?)

Before:

AFTER (Listing photos)

All in: $150,000

I accepted an offer of $182,000

After fees/commission/etc I will be left with $16,000 ish which is then divided in half so I'm making around $8,000 on this one. Closing is set for July 20th.

As long as I don't lose money I dont count it as an actual loss but when it's only $8k I take it as a personal loss because I know my tie and energy could have been used better to make maybe double that. But seeing as its my 2nd flip im not going to be too hard on myself. 

Ive learned so much from these first 2 I cant even begin to start with any kind of knowledge to share as its so much. 

But yeah there ya have it. My first 2 flips! Successful to me so im happy. 

But as of right now Im looking for my next 2 properties (trying to juggle 2 at a time) 

so let me plug this quick...

LOOKING FOR PROPERTIES IN WEST CHICAGO SUBURBS / DUPAGE COUNTY

CASH BUYER!!!!!  Someone please lead me to my next properties!!!

-Also I want to thank anyone who took the time to read through this or just skim through it! I will try to respond to any replies as quick and thoroughly as possible! 

Thanks!!

9Reply
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Most Popular Reply

Investor · Frisco, TX · Member since 2014 · 76 posts · 18 votes
11y

Awesome job on both those flips! It's always hardest to get started but now you got the ball rolling. Can't wait to see your next ones. 

See this reply in the discussion

76 Replies

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  • Investor · Madison, WI · Member since 2015 · 128 posts · 33 votes
    11y
    Originally posted by @Danielle Cage:

    @Robert Obniski Congrats on making it happen! It's always great to see others out there just starting out and doing well. As a beginner, these stories are very encouraging to me. Thanks for sharing!

     Thank You! I know a few of the stories kept my fire going. Im glad I could do the same!

  • Investor · Marina Del Rey, CA · Member since 2014 · 24 posts · 17 votes
    11y

    As a former Chicagoan who grew up in the NW suburbs and loved the city too but hated the weather I just wanted to congratulate you on your eye for design. I am a former architect, former house investor and currently a vacant land flipper but the way you finished out those two projects looks really impressive. You've got some talent there you shouldn't overlook that I'm sure contributed to you selling both of those projects. Keep at it.

  • Solo 401k Expert · Anaheim Hills, CA · Member since 2012 · 18k+ posts · 6k+ votes
    11y

    Congratulations @Robert Obniski, great job!

  • Rental Property Investor · Chicago, IL · Member since 2015 · 14 posts · 4 votes
    11y

    This is inspiring! I'm just getting started fresh out of college. How did you go about finding investors?

  • Gretna, LA · Member since 2014 · 3 posts · 0 votes
    11y

    Very Impressive! What type of flooring is that? It has a very elegant look! 

  • Investor · Aurora, IL · Member since 2015 · 39 posts · 6 votes
    11y

    @Robert Obniskigreat job. I am still working on determining where should i start with & your blog really inspires me. I would ideally love to get hand on some properties that require little cosmetic changes and flip it quickly - just the way u did. 

    I see that MLS is the way you took to review your properties, is that correct?

    I am a bit curious though, unfortunately, i am not as handy as you are (your pictures look amazing) - what would your profits be in case you used handyman/ contractor for the job? and also noted that you did not mention about any carrying costs - am guessing because they are insignificant in the larger scheme of things? 

    Nevertheless, Congratulations and hope to meet you in one of the local meetups.  

  • Anaheim, CA · Member since 2013 · 10 posts · 1 vote
    11y

    Wow, great post. Very nice job on the rehab. 

  • Steven MallowPro Member
    Insurance Agent · Jefferson City, MO · Member since 2015 · 67 posts · 10 votes
    11y

    @Robert Obniski Great looking floors man. I'm still searching for my first flip. 

    Congrats on your success. 

  • Residential Real Estate Broker · Orlando, FL · Member since 2015 · 4 posts · 2 votes
    11y

    Great job! Bravo Robert !Love to hear these success stories. Great start 

  • Professional · Mount Vernon, OH · Member since 2015 · 12 posts · 3 votes
    11y

    @Robert Obniski

    Glad to see your having a lot of success based on industry standards! I'm just getting licensed now as a real estate agent so one of my questions for any/all of you as investors... What do you look for most in an agent? What are the most important things you consider when buying that property?

    Nathan

  • Investor · Downingtown, PA · Member since 2015 · 31 posts · 13 votes
    11y

    Robert Obniski,

    Great story man! I love how you celebrate (Jack & Coke) :)

    It's been said a few ways already in this thread...but it is TERRIFIC that you had the success you have had recently.

    (Things did seem a little tighter on that second job...)

    But the experience you got and the resume you are building up...I'm sure there are more lessons to be learned along the way...but this is a terrific start.

    Several posts have been about figuring out the "systems"
    How you find the next project
    Who you acquire funds from
    Who you hire for various parts of the job...

    These systems separate the great businesses from the average or just good businesses.

    Look forward to hearing how you continue to shape your business into a GREAT business!

    -Bryan

  • Cumming, GA · Member since 2014 · 218 posts · 71 votes
    11y

    @Robert Obniski,

    good job on both flips (don't worry about second one, experience is earned, you're not born with it...)

    now, since you're looking to flip in DuPage, i suppose you already have contractor accounts with home depot/menards/hobo/sherwin wiliams/ben monroe...

    ...and @Brie Schmidt (who already posted here) is one of the organizers of the Chicago area meetup....

  • Investor · Madison, WI · Member since 2015 · 128 posts · 33 votes
    11y
    Originally posted by @John Becker:

    As a former Chicagoan who grew up in the NW suburbs and loved the city too but hated the weather I just wanted to congratulate you on your eye for design. I am a former architect, former house investor and currently a vacant land flipper but the way you finished out those two projects looks really impressive. You've got some talent there you shouldn't overlook that I'm sure contributed to you selling both of those projects. Keep at it.

     Wow, I dont ever think I have gotten a compliment like that before. To me, I was just doing what I thought needed to be done. Im glad it turns heads  like that. Thank you very much. And enjoy that weather over there!

  • Investor · Madison, WI · Member since 2015 · 128 posts · 33 votes
    11y
    Originally posted by @Kiara Washington:

    This is inspiring! I'm just getting started fresh out of college. How did you go about finding investors?

    A family business that I was a part of a few years back sold and I received some of the profit. That is how I funded the first project. The 2nd was just a good relationship with retired folks who have no income but are looking for some. They know/trust me enough to know that im not going to lose there money. And if I did, its because we all have bigger things to worry about at that point haha

  • Investor · Madison, WI · Member since 2015 · 128 posts · 33 votes
    11y
    Originally posted by @Vicky S.:

    @Robert Obniskigreat job. I am still working on determining where should i start with & your blog really inspires me. I would ideally love to get hand on some properties that require little cosmetic changes and flip it quickly - just the way u did. 

    I see that MLS is the way you took to review your properties, is that correct?

    I am a bit curious though, unfortunately, i am not as handy as you are (your pictures look amazing) - what would your profits be in case you used handyman/ contractor for the job? and also noted that you did not mention about any carrying costs - am guessing because they are insignificant in the larger scheme of things? 

    Nevertheless, Congratulations and hope to meet you in one of the local meetups.  

    Thanks I appreciate it. And yes, I found both deals on the MLS. Mind you, it was middle/end of winter which is one of the better times to buy.

    i would assume that my profits would be at least 1/2 of what they are. As for not being handy, just go and do it. That simple really. I wasnt born this way, I went from zero skill to handy over the years...although I was forced to because my dads a hardass...in a good way haha But if its a cosmetic flip like mine, I would suggest diving in and do what you know you can do and for the things you cant, use the internet, this forum or you tube. Good Luck!

  • Investor · Madison, WI · Member since 2015 · 128 posts · 33 votes
    11y
    Originally posted by @Nathan Fox:

    @Robert Obniski

    Glad to see your having a lot of success based on industry standards! I'm just getting licensed now as a real estate agent so one of my questions for any/all of you as investors... What do you look for most in an agent? What are the most important things you consider when buying that property?

    Nathan

    I would like the agent to know all the 'rules' or tips or guidelines. They should know the "other" costs involved in investing not just the purchase price + closing + rehab + selling + closing costs again. 

    I think the best way to go about it is, ask your client these questions...

    -What is your 'all-in' budget? (At the end of the day all in all not one cent more)
    -What is the type of rehab you're looking to do? (Cosmetic or Gut..or somewhere in between)
    -What is the lowest profit you;re willing to make?

    From there, If I were an agent I would narrow it down to a few properties. I would then personally estimate the costs and profits and what their maximum purchase price is, etc.

    ....essentially do everything for them haha but really if you ever plan on getting into the game yourself, it will be great practice. 

  • Brownsville, TX · Member since 2015 · 9 posts · 1 vote
    11y

    @Robert Obniski Way go to!! Congratulations on your first Flip.

  • Investor · Madison, WI · Member since 2015 · 128 posts · 33 votes
    11y
    Originally posted by @Bryan McCloskey:

    Robert Obniski,

    Great story man! I love how you celebrate (Jack & Coke) :)

    It's been said a few ways already in this thread...but it is TERRIFIC that you had the success you have had recently.

    (Things did seem a little tighter on that second job...)

    But the experience you got and the resume you are building up...I'm sure there are more lessons to be learned along the way...but this is a terrific start.

    Several posts have been about figuring out the "systems"
    How you find the next project
    Who you acquire funds from
    Who you hire for various parts of the job...

    These systems separate the great businesses from the average or just good businesses.

    Look forward to hearing how you continue to shape your business into a GREAT business!

    -Bryan

     Yes! I agree, systems and models are key. Im trying to make them as fluid as possible but it's just the beginning. I just hate knowing that I know what I need to do and how to do it to make big returns but its all about finding the right property and getting it for the right price. After that, the entire process is pretty simple for me. Prioritize everything and execute, speed bump happens? Adapt. Obviously easier said than done ;) But thank you, sir. I appreciate the comments. 

  • Investor · Madison, WI · Member since 2015 · 128 posts · 33 votes
    11y
    Originally posted by @Dumitru Anton:

    @Robert Obniski,

    good job on both flips (don't worry about second one, experience is earned, you're not born with it...)

    now, since you're looking to flip in DuPage, i suppose you already have contractor accounts with home depot/menards/hobo/sherwin wiliams/ben monroe...

    ...and @Brie Schmidt (who already posted here) is one of the organizers of the Chicago area meetup....

     Very accurate and true statement.  

    As for contractor account, I have set one up with home depot as it was the closest store to both properties and would match any product pricing I needed. As for paint, sherman williams said I need a actual contractor licence to get there discounts. I never thought much of it since while i was at the store buying everything an actual contractor was kind enough to let me buy it under his account. Why do you ask? Do you have some kind of connection I should know about?? ;)

    Also I ahve been to 2 of the Chicago meet ups. Feburary and May. Each time I have come out with at least 1 connection so they are definitely a great thing for the community. Thanks @Brie Schmidt for everything you do in regards to that! (Also sorry I never got back to you when I said I was going to :/ )

  • Investor · Morton Grove, IL · Member since 2015 · 44 posts · 5 votes
    11y

    @Robert Obniski that floor looks perfect for flips! and congrats on the success so far!

    Are all the materials you are buying through Menards or Home Depot or are they specialty stores?

  • Investor · Madison, WI · Member since 2015 · 128 posts · 33 votes
    11y
    Originally posted by @Siraj Ahmed:

    @Robert Obniski that floor looks perfect for flips! and congrats on the success so far!

    Are all the materials you are buying through Menards or Home Depot or are they specialty stores?

     Thanks, i was a big fan of the floors also. Almost everything was menards/hd. Paint was sherwin williams. Aplliances was sears. Flooring was floor and decor.

  • Investor · Morton Grove, IL · Member since 2015 · 44 posts · 5 votes
    11y
    Originally posted by @Robert Obniski:
    Originally posted by @Siraj Ahmed:

    @Robert Obniski that floor looks perfect for flips! and congrats on the success so far!

    Are all the materials you are buying through Menards or Home Depot or are they specialty stores?

     Thanks, i was a big fan of the floors also. Almost everything was menards/hd. Paint was sherwin williams. Aplliances was sears. Flooring was floor and decor.

     @robert

  • Investor · Morton Grove, IL · Member since 2015 · 44 posts · 5 votes
    11y

    @Robert Obniski have you done other deals since these two?

  • Investor · Madison, WI · Member since 2015 · 128 posts · 33 votes
    11y
    Originally posted by @Siraj Ahmed:

    @Robert Obniski have you done other deals since these two?

     Sorry I never got back to you on here but Yes, I have one currently listed in Addison. I had the same buyer back out twice on that one.  Listed for about 2 months now, getting antsy.

    I also just put a 2 bed 1 ba sfr under contract here in Lombard. This one is going to be tricky as its my first SFR and a little out of my criteria as far as 2 bed 1 bath. Comps are there though.

  • Real Estate Investor · chicago, IL · Member since 2012 · 1k+ posts · 231 votes
    11y

    great job! you may want to (I'm sure you already have) consider the amount of hours you put into this and figure out your rate per hour.  on the other hand, you gain valuable experience.

    my goal is to minimize the amount of time on the project as much as possible. doesn't always work that way though. :)

    if it's a hobby, then I don't really consider the time involved as long as it doesn't interrupt your day job and the wife is okay with it. lol

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