My First Flip! With Numbers and Photos!

My First Flip! With Numbers and Photos!

Pensacola, FL · Member since 2017 · 163 posts · 312 votes

I realize I do not have a ton of posts here on Bigger Pockets, but I can’t emphasize enough the impact BP has had on me in a short time.  In the interest of community and sharing success stories with others that might be looking for some motivation, I wanted to detail my start in RE.  I’ll try not to be too lengthy, but I think people can identify with these stories a little better when there is some personal context.

My name is Ben Ervin and I am a Program Analyst for the Naval Education and Training Command in Pensacola, FL.  I enjoy knowing what I do is impactful and supports the Sailors that serve our country.  But, I have always had an attraction to the idea of entrepreneurship.  I’ve known since I was 13 years old that I wanted to be my own boss one day.  Yesterday marked a big step towards that goal when my wife and I listed our first flip property on the market.

In October of 2017 I decided to stop thinking about flipping houses and start educating myself on how to get in the game.  I found that a friend of mine, @Nick Armstrong, was flipping houses and got a chance to talk shop with him a bit and he directed me here to BP.  From that point, it took me 4 months to close on our first deal.  It hasn’t sold yet, but we are in a hot market right now where I believe data supports a high demand for the product we are offering.  Beyond all of that, the really invaluable part of this experience has been education.  I have learned A TON.  We certainly made mistakes along the way, but I can take those lessons learned and leverage them going forward.  I intend to use this first deal as a launching pad to doing more deals, including additional flips in the near term with the goal of building a rental portfolio for long term passive income.

Now I will stop rambling and show you what we’ve done.  The house has not sold yet, but assuming full price offer, here is the breakdown by the numbers along with (everyone’s favorite part) photos.

Projected Numbers:

Acquisition Costs (AC): $70,635.50

- Purchase Price: $70,000

- Closing Costs: $510

- Termite Letter: $125

Rehab Costs (RC): $41,185

- Materials: $21,780

- Labor: $19,405

Holding Costs (HC): $870

- Utilities: $450

- Insurance: $420

Selling Costs (HC) *Assuming Sales Price (SP) of $175k*: $10,500

- Commissions to Agents: $10,500

Projected Profit: $51,810 – Taxes & Any Additional Selling Costs

- $175,000(SP) - $10,500(SC) - $870(HC) - $41,185(RC) - $70,635(AC) = $51,810

Now on to the photos...

Exterior Before:

Exterior After:

Interior Before:

Interior After:

I still have a ton to learn, but I look forward to trying to answer any questions you might have. Furthermore, if anyone here in my local market wants to just say hello, I invite you to do so. I hope to be more involved in the BP and larger REI community as a whole going forward.

Thanks for listening/checking out my progress so far and good luck to all!

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James MasottiPro Member
Rental Property Investor · Washington Township, NJ · Member since 2015 · 1k+ posts · 976 votes
8y

@Benjamin Ervin - Can you share the scope of work? Looks like you got a lot of work done for $41k...either that or my construction cost are really just that much more expensive up here in the Northeast

See this reply in the discussion

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  • Worcester, MA · Member since 2018 · 1 post · 1 vote
    8y

    This project turned out great.  Congratulations 

  • Real Estate Broker · Windsor, CT · Member since 2015 · 1k+ posts · 268 votes
    8y
    Wow this flip came out great!!! Awesome job on your first flip!!
  • Investor · Northern Virginia · Member since 2017 · 159 posts · 59 votes
    8y

    Great work! Congrats!

  • Investor · Memphis, TN · Member since 2016 · 215 posts · 128 votes
    8y

    Gorgeous transformation!

  • Birmingham, AL · Member since 2014 · 7 posts · 5 votes
    8y

    LOVE the painted brick..Love the higher grade finishes and upgrades! You did this 'right' and it's what buyers are looking for. Are you going to stage it up a bit? I've actually used some of my own furniture to stage a project house with and it pushed the interest up quite a bit as it gave the buyers more of an idea how furniture and decor can look...(kept it trendy) xo

  • Flipper/Rehabber · Frisco, TX · Member since 2012 · 4 posts · 1 vote
    8y

    Good job on your first project! Love the interior design! 

  • Niceville, FL · Member since 2017 · 15 posts · 3 votes
    8y

    Great deal and thanks for sharing!!! I am continuing to learn a ton from the BP community as well. Looking to make a move here around the Niceville area. I wish all the best for your future endeavors. 

  • Renter · Grandview, MO · Member since 2014 · 6 posts · 1 vote
    8y

    Amazing work! Great design! Continued success.

  • Investor · Kansas City, MO · Member since 2017 · 17 posts · 9 votes
    8y

    Killed it!

  • Rental Property Investor · Lexington, KY · Member since 2018 · 8 posts · 1 vote
    8y

    The design is great. I like how light it is but it still looks very substantial. Did you choose this yourself? What is on the ceilings? 

  • Meridian, ID · Member since 2018 · 16 posts · 8 votes
    8y
    @Benjamin Ervin The rehab looks fantastic! Thank you for sharing this win. It is truly inspiring to see the numbers and the outcome of your project.
  • New to Real Estate · Atlanta, GA · Member since 2018 · 5 posts · 2 votes
    8y

    Wow! Veryy nice! You did a great job!

  • Real Estate Agent · WHITTIER, CA · Member since 2017 · 26 posts · 4 votes
    8y
    That’s awesome! Definitely motivational!
  • Anaheim, CA · Member since 2015 · 48 posts · 11 votes
    8y

    Congrats @Benjamin Ervin ! Great job!

  • Philadelphia, PA · Member since 2016 · 13 posts · 6 votes
    8y
    great job!
  • Freedom, WI · Member since 2018 · 1 post · 1 vote
    8y

    Looks great! Congrats!

  • David SichermanPro Member
    Vendor · Lake Worth, FL · Member since 2014 · 713 posts · 149 votes
    8y

    Wait, you didn't close yet?  Not to crap in anyone's hat, but I would wait to post results until after you close.  Having closed many properties things can change wildly while waiting for that first closing lol.

  • Delray Beach, FL · Member since 2018 · 7 posts · 3 votes
    8y

    @Brian Garrett In Delray Beach, Kings Point.. great for a starter and summer is the best time while snowbirds away

  • Flipper/Rehabber · Oviedo, FL · Member since 2017 · 18 posts · 21 votes
    8y

    Ben, awesome job! I noticed the ceilings immediately and want to incorporate a similar look, what material did you use? (is that painted pine 1x6's, hardiboard, ?)?

    Fantastic first deal!

  • Pensacola, FL · Member since 2017 · 163 posts · 312 votes
    8y
    Originally posted by @Alan Kahanu:

    Looks terrific @Benjamin Ervin and the numbers look really good, congratulations! Is the interior renovation and ARV in line with middle of the road to the neighborhood homes?

    Hey, Alan. Based on my research of the zip code in total (including valid comps), our design is superior to other products being offered currently. The ARV is in line with the higher end of similar properties, yet cheaper than some even though our rehab included a larger scope of work. I feel pretty good about the price point as we've had at least 2 showings every day (including Saturday and Sunday) since listing. We currently have two interested parties that have notified us of their interest in making an offer.

  • Pensacola, FL · Member since 2017 · 163 posts · 312 votes
    8y
    Originally posted by @Lisa O.:

    I'm in Central Florida and we can't flip unless we have a general contractor license, even as the owner. There's nothing prohibiting you there from doing it just as the owner? 

    If/when you do this again, I would suggest using a flat fee listing company that can get your property on MLS for a couple hundred dollars and offer the buyer's agent their 2 or 3% cut. I've had success selling two former homes offering only 2% (higher $$ amount) bc if a buyer sees it on realtor.com or zillow, they'll make their agent show it to them and agent will just have to settle for 2%.

     Hi, Lisa.  The answer to your question is no, we are not required to have a GC license in order to flip homes purchased under our name.

    Thank you for the suggestion.  My wife is currently in the process of getting her Real Estate license, so we intend to avoid those costs moving forward.  Regardless, I feel like the realtor we've used (this will now be our second transaction with her) has added a lot of value for us throughout this process.  Certainly far more than the 3% we are paying for her service.  That is my opinion, of course.

  • Washington, WASHINGTON D.C. · Member since 2018 · 35 posts · 3 votes
    8y
    Wow! Everything looks great. Good job!
  • Pensacola, FL · Member since 2017 · 163 posts · 312 votes
    8y
    Originally posted by @Logan Turner:

    Benjamin Ervin
    Great job on the rehab. Very nice looking.

    A few things to consider:

    Plan out whether it will be a flip or BRRR at the beginning. This would be a terrible rental. Too nice and you would be disappointed after wear and tear on it. Materials should be durable not pretty (laminate vs tile/vinyl planks). It shouldn't be the prettiest house in the neighborhood.

    Financing: people are referring to hard money lenders. Not fixed Fannie Mae loan.

    Also consider local credit unions. Dodd frank acts being repealed will help them lend to people they have a relationship with.

    Logan, thank you for your input.  We absolutely agree this would be a terrible rental based on the design choices we've made.  In fact, the numbers work as a rental, but practically speaking the materials do not.  We understood this when making the choices we did. 

    We intend to use the BRRR method in the future, but until we can generate revenue to use for cash reserves, I prefer to not to hold any properties. That will absolutely change soon.

    Understand the financing terminology.  That rolled over my head while reading/responding, so thanks for the clarification.

    I am already discussing cash out refi options with my local credit union.  I've banked with them since I was 14 and opened my first checking account, so I have built a pretty good level of rapport already considering my lack of experience. 

  • Pensacola, FL · Member since 2017 · 163 posts · 312 votes
    8y
    Originally posted by @Nick Ziegelmann:

    This is an amazing first flip Ben! Looks incredible! I currently reside out in Tallahassee, FL and am wanting to get into the same business as flipping houses and what not, but I’m not sure where to start?

     Nick, I am still pretty green but my suggestion to you would be to start educating yourself.  This means doing market research, learning the terminology/language, listening/reading to podcasts/books, etc.  There is an incredible amount of FREE information at your disposal.  Take advantage of that and put the horse before the cart.

  • Rental Property Investor · Des Moines, IA · Member since 2014 · 11 posts · 9 votes
    8y

    Wow Ben! You should be very proud of the result -- great financial flip but taking a tired home and creating an affordable home that people will be proud to bring guests into. Very inspiring!

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