Investment Info:
Single-family residence fix & flip investment in Nashville.
Purchase price: $123,000
Cash invested: $72,000
Sale price: $220,000
This is my second flip in North Nashville, and actually the second one of the exact same house floorplans. This house was 704 sq ft, 2 bedroom 1 bath. Great floor plan in my opinion to flip because they are so small that its hard for the original builders to mess much up. You have very little plumbing to go wrong, its real easy to rewire if need be, and typically the flooring system is pretty solid. Exceptions to everything of course.
The last one we added on to making it a 3 bed 2 bath, but this one we decided to just fix it up as is. The only adding we did was a front porch roof, and we took the existing foundation for the back porch and storage room and converted it into a laundry/mud room. After that the house ended up being a 2/1 754 sq ft.
The idea of not adding any square footage was fine, however the whole flip was supposed to be quicker and easier. Because I'm doing it all on the side it took me too long, (which isn't that what everyone says) and we ended up having to replace just about everything. New roof, siding and soffit, plumbing, complete electrical, insulation, hvac, and of course all the kitchen and bathroom. I don't regret making all the repairs, but I think the downside is that if you are going to do all those things and not add square footage, you don't have the economies of scale to make up the ending sales price. So for probably $20k more I could have added 500 more square feet which would have upped the sales price $60k. So you're probably asking, duh why didn't you do that? Well one, it was an experiment, and two if you do this flip in 3 months to pocket 15-20k then its not bad. This one took about 9 months time even though I was only able to work on it for maybe 2 or 3 months. (How I'm running my business/investments leaves some to be desired for sure. I get it.)
All in all we are proud of what we did to the house. Some people in the area buy the same house and just leave the vinyl siding on, and that's fine but that's not the kind of work I'm looking to do. I want to put a quality house on the market to get top dollar because I know its the best house of its kind. Always real hardwoods, granite, and new appliances. Sometimes some of the things don't pay for themselves, but its worth it to me to know I did everything the way I would want it in my house. Because of this I feel is why we were able to get asking price offer in 5 days with an easy close.
Thanks for reading,
Josh
What made you interested in investing in this type of deal?
I think this is a great area to invest that is just going to keep developing.
How did you find this deal and how did you negotiate it?
I found it on the mls. We made an offer and they said this multiple offers they were to require a best and highest. They did not accept ours. Until about 2 weeks later they asked if we were still interested. So they ended up accepting our first offer.
How did you finance this deal?
Cash and a HELOC.
How did you add value to the deal?
Adding a Laundry room, and general restoration.
What was the outcome?
Took too long but had a great sale experience with low days on the market.
Lessons learned? Challenges?
Probably need to add more square footage to such a small house. That was the main complaint at the open house. Need to do a little better job looking at the history of the house. Turns out the power hadn't been on for 7 years. It was fully furnished so we had no idea.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Yeah our agent Emily Pritchard with Village Realty is great! Especially in that part of town, but just good in general. I would highly recommend her as a buying or selling agent.
