$50K Flip Property Success

Real Estate Deal Analysis & Advice
9yFollow

$50K Flip Property Success

Rodney Marcantel
Coppell, TX · Member since 2014 · 188 posts · 125 votes

Just got an offer 4 days after listing my latest flip property $6,500 over asking. Working with Listing Spark for the first time has saved me over $6,500 in commissions! So that's $6,500 over asking plus $6,500 in commission savings = $13K in additional profit over asking price.

Breakdown of which I did 70% of the work myself...

Purchased home for $112,000 (Cash) 2/24/2017
Closing Costs: $1,461.06
Rehab Expenses: $58,540.78
Holding Costs: $278.17 (Utilities)
Offer Accepted: $230,500 (Asked $224K) 5/8/2017
Profit: $52,637.22
Total Rehab time: 69 days
Days on market: 4 days

Home Facts: 1576 sq.ft. 3/2/2, new roof, foundation (21 piers), masonry work, new HVAC, New Appliances, New cabinets (soft close), totally gutted bathrooms, new floors throughout, new landscaping and sod, painted brick and all interior and 2 non-load-bearing walls removed in kitchen.

48Reply
392 views

Most Popular Reply

Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
9y

nice work !! that's a very quick flip.. you must have some good crews as well.

what about cost of capital.. did you do this all out of pocket ???

Listing Spark ??? whats that

did they offer over list and then ask for seller pre paid credits for their loan.. virtually every deal I have ever done under 300k the buyer ask for seller credits for Closing costs.

how about property taxs?  need to factor those and insurance.

OH I see you did most the work yourself  so you can't beat on the GC or the help

end of the day nice job.

Most folks who would have to hire this out.. and get HML would not do near as well of course but still be in the Black

Podcast Guest on Show #222
JLH Capital Partners51 Review
WebsiteView Page
9Reply
See this reply in the discussion

151 Replies

Jump to latestLatest
  • Chase Beasley
    Developer & Engineer · Atlanta, GA · Member since 2017 · 41 posts · 14 votes
    9y

    @Rodney Marcantel Nice work. I second the notion of trying to see what the rehab costs were by line item to see how much you saved overall by doing the contracting (or 70% of it) by yourself. 

    Amazing timeline given the extent of work. 

    1Reply
  • Rodney Marcantel
    OP
    Coppell, TX · Member since 2014 · 188 posts · 125 votes
    9y
    Originally posted by @William C.:

    Rodney Marcantel thanks for the clarity. You quoted the insurance at $2k, that's where I got the figure, you just didn't have anything in the "actual" column.

    Regarding the appraisal....the comps sold for 180-190k with similar sq ft? Yikes. I truly mean it when it say good luck,I hope for the best and that it appraises for what you need. In my experience appraisers don't differentiate from "brand new" like yours, and the comp down the street that was remodeled 10 years ago. Unless its extremely dated, or falling apart, they are both usually a labeled C3 in the eyes of the appraiser and therefore appraise for the same amount. Even if you are a C2 and they are a C3, the adjustment is typically $20k. Your $50k over the nearest comp? There is no adjustment for "new kitchen" or new bath. Its line for line, sq ft, beds, baths, etc, etc....I'm probably wrong and it'll appraise just fine. I'm on your side. I feel if a buyer is willing to pay X, then adjust accordingly and appraise it for X. Unfortunately for me I've been burnt too many times that I never assume it's appraise any higher no matter how much nicer it is compared to the comps.

     We're seeing in the DFW area rehabbed properties going much higher than partial or no rehabbed properties. Partial is when they update kitchen counters and backsplash but leave old cabinets. People are willing to pay more for new solid wood constructed soft close drawer cabinets and white cabinets are the in thing now and they are more expensive. Same for luxury master baths over just new shower tile and floor tile with no expansion or new light fixtures. Our price is on par with homes 20 years newer and the same sq.ft. because it's been updated from the ground up (electrical, plumbing, foundation, roof, A/C, etc.). All big ticket items.

    0Reply
  • Scott W.
    Real Estate Investor · chicago, IL · Member since 2012 · 1k+ posts · 231 votes
    9y

    the only issue with that is you have to hope the home appraises.  it worked out for you but some appraisers just go off the most recent sold comps.

    0Reply
  • Natalie Schanne
    Real Estate Agent · Princeton, NJ · Member since 2016 · 1k+ posts · 1k+ votes
    9y
    Rodney Marcantel - Looks beautiful. Can you post the before pictures too?
    0Reply
  • Rodney Marcantel
    OP
    Coppell, TX · Member since 2014 · 188 posts · 125 votes
    9y
    Originally posted by @Scott W.:

    the only issue with that is you have to hope the home appraises.  it worked out for you but some appraisers just go off the most recent sold comps.

     Then they are not good appraisers. If it does come off under the sold price AND if the buyers aren't willing to cover the difference, then I'll get my agent to have the house appraised with their trusted appraiser.

    0Reply
  • Rodney Marcantel
    OP
    Coppell, TX · Member since 2014 · 188 posts · 125 votes
    9y
    Originally posted by @Natalie Schanne:

    Rodney Marcantel - Looks beautiful. Can you post the before pictures too?

     You can see them on my facebook page under /Buydallasinvestments

    0Reply
  • Scott W.
    Real Estate Investor · chicago, IL · Member since 2012 · 1k+ posts · 231 votes
    9y

    IKR! the only issue w/ lower end homes (obviously yours isn't) is if it's going fha and a flip, they take the LOWER of the 2 appraisals and it STICKS w/ the home for a miniumum of 6 months.

    as you mentioned earliery, rehabbed flipped properties can appraise A LOT higher than normal sales.

    0Reply
  • Alamen Ems
    Dublin, OH · Member since 2017 · 45 posts · 10 votes
    9y
    Congratulations, good job
    0Reply
  • Sejal B.
    Rental Property Investor · Dallas, TX · Member since 2016 · 28 posts · 15 votes
    9y

    Well done sir, congratulations! Thank you for sharing your expense sheet, very helpful to see the breakdown in costs. 

    1Reply
  • William C.
    Real Estate Agent · Souderton, PA · Member since 2016 · 591 posts · 414 votes
    9y
    Originally posted by @Rodney Marcantel:
    Originally posted by @Scott W.:

    the only issue with that is you have to hope the home appraises.  it worked out for you but some appraisers just go off the most recent sold comps.

     Then they are not good appraisers. If it does come off under the sold price AND if the buyers aren't willing to cover the difference, then I'll get my agent to have the house appraised with their trusted appraiser.

    I am not trying to be negative Nancy and rain on your success parade. I don't want any of this bad stuff to happen, all I'm saying is it could and it has to me. I do have to point out that your plan to have your agents appraiser come in after the fact will simply not do anything. First, I think you mentioned the buyers went FHA. If that's the case, the appraisal done by their lender will be the appraisal that sticks to the house for the next 6 months no matter what. FHA appraisals are property specific and if those buyers can't close, the next buyer to come along FHA would have to use the same appraisal, for up to 6, months. Second, if the buyers are not FHA, it's irrelevant what any other appraiser says, it's the banks appraiser that matters, and if they come in low, there is nothing that can be done to change the course of that deal (aside from an appeal).

    The point you made about your market appraising higher was a good one.  I do hope your fine.  $50k seemed like a big bridge to cross for the comps you mentioned that sold recently.   

    0Reply
  • Kai Kopsch
    Real Estate Broker · Charlotte, NC · Member since 2016 · 569 posts · 351 votes
    9y

    Congrats @Rodney Marcantel such a perfect flip it was so quick.How do you do that  so amazing and a wonderful design.Hope for your more success.

    1Reply
  • Joe Armstrong
    Real Estate Investor · Ellington, CT · Member since 2016 · 16 posts · 2 votes
    9y

    Awesome numbers and the place looks great. Congrats 

    0Reply
  • Kyle Agius
    Broomfield, CO · Member since 2016 · 14 posts · 0 votes
    9y

    Incredible work.  Congrats!

    0Reply
  • Vanesa Gonzalez
    Rental Property Investor · Miami Beach, FL · Member since 2017 · 105 posts · 59 votes
    9y

    Excellent work! Beautiful details, LOVE the barn doors. Thanks for sharing your story. When I started in this business my father was the person doing most of the work. It was so good to work together but also it was an easier road for me. It was difficult to find reliable people in Miami but I think I am getting there. My father is retired now but he still takes care of my rentals in Argentina. I WOULD LOVE to learn to do some of the manual work and after reading your post, may be its time! Cheers

    1Reply
  • Scott W.
    Real Estate Investor · chicago, IL · Member since 2012 · 1k+ posts · 231 votes
    9y
    Originally posted by @Rodney Marcantel:
    Originally posted by @Scott W.:

    the only issue with that is you have to hope the home appraises.  it worked out for you but some appraisers just go off the most recent sold comps.

     Then they are not good appraisers. If it does come off under the sold price AND if the buyers aren't willing to cover the difference, then I'll get my agent to have the house appraised with their trusted appraiser.

     you can't use your agent's appraiser; the bank goes thru a 3rd party that selects the appraiser.  at the end of the day, the appraisal company works for the bank as they are on the hook if the buyer ever bails on the house.

    0Reply
  • Jill Denlea
    Investor · Cumming, GA · Member since 2017 · 1 post · 1 vote
    9y

    Congratulations! It's a gorgeous home!

    1Reply
  • Tomi Osibodu
    Real Estate Investor · San Diego, CA · Member since 2017 · 13 posts · 0 votes
    9y

    Great job the project looks wonderful. How did you find the property?

    0Reply
  • Rodney Marcantel
    OP
    Coppell, TX · Member since 2014 · 188 posts · 125 votes
    9y
    Originally posted by @Tomi Osibodu:

    Great job the project looks wonderful. How did you find the property?

    Rehab Valuator software.

    1Reply
  • Tomi Osibodu
    Real Estate Investor · San Diego, CA · Member since 2017 · 13 posts · 0 votes
    9y

    Please explain. What is a rehab valuator software and how did it help you find the deal

    0Reply
  • Rasheeda Saboor
    Atlanta, GA · Member since 2017 · 4 posts · 0 votes
    9y

    That's awesome!!!

    0Reply
  • Brady Durr
    Investor · Fort Worth, TX · Member since 2016 · 41 posts · 48 votes
    9y

    I agree with @Jason Carter.  If you get time run an loan amortization table for $230K @6% @360 months and look at the principle and interest payment you could get each month by being the lien lord.  Something to thing about as you look for streams of passive income in the future.

    0Reply
  • Hector Cano
    Realtor · Los Angeles, CA · Member since 2017 · 3 posts · 1 vote
    9y

    Great Job! 

    0Reply
  • Noel Darren
    Real Estate Investor · Lake Charles , LA · Member since 2015 · 1 post · 1 vote
    9y
    Real nice great job.
    1Reply
  • Rodney Marcantel
    OP
    Coppell, TX · Member since 2014 · 188 posts · 125 votes
    9y
    Originally posted by @Tomi Osibodu:

    Please explain. What is a rehab valuator software and how did it help you find the deal

     Just look up their website rehabvaluator dot com. They have a program that finds off market deals.

    0Reply
  • Daniil Kleyman
    Real Estate Investor · Glen Allen, VA · Member since 2008 · 74 posts · 43 votes
    9y

    Nice work, Rodney!  Glad Rehab Valuator helped you find the deal!  We're adding more and more deals there every day

    2Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free