All Forum Posts by: Logan Howell

Quote from @Adam Bartomeo:

Quote from @Logan Howell:

Quote from @Adam Bartomeo:

First, to get out of your first 2 flips without losing money is great job! Most investors lose money on their first flip, at a minimum.

Second, there are 3 main numbers to review - purchase price, expenses, sales price. You would have to tell us where you went wrong. Based on your due diligence you failed on one of these three numbers. Most new investors fail when buying. They do not buy low enough and this is likely your problem. They also do not stick to their budget or do not anticipate unforeseen expenses. Lastly, they overestimate the sales price.

Tip, I have used hard money one time and one time only! I realized that the hard money lender made more than anyone on the transaction. If you were able to go in cash you would have saved about $25,000 in expenses.

Good to know about hard money - I've come to get this impression as well. If you dont mind me asking, was this cash you switched to lent or your personal capital? If the latter, I'll need to save up more before that's an option for me.

I do both but prefer to have a cash partner because my CoC return is infinite.

Good to know, thanks. Any advice for finding a cash partner for flips? I imagine it's a matter of building connections and flip experience? 

Quote from @Adam Bartomeo:

First, to get out of your first 2 flips without losing money is great job! Most investors lose money on their first flip, at a minimum.

Second, there are 3 main numbers to review - purchase price, expenses, sales price. You would have to tell us where you went wrong. Based on your due diligence you failed on one of these three numbers. Most new investors fail when buying. They do not buy low enough and this is likely your problem. They also do not stick to their budget or do not anticipate unforeseen expenses. Lastly, they overestimate the sales price.

Tip, I have used hard money one time and one time only! I realized that the hard money lender made more than anyone on the transaction. If you were able to go in cash you would have saved about $25,000 in expenses.

Good to know about hard money - I've come to get this impression as well. If you dont mind me asking, was this cash you switched to lent or your personal capital? If the latter, I'll need to save up more before that's an option for me.

Thanks everyone. Really appreciate the thoughts and advice. I, too, think I spent too much on purchase and should've crunched the numbers more carefully beforehand.

Hello flippers,

I'm relatively new to this and have broken even on my first two flips. Could anyone experienced with this help review the numbers from my latest flip to see where all I'm going wrong? I should mention I paid a GC for the rehab work, who charges $18k for managing the project; I have a full time job, so unfortunately I don't have time to manage it myself.

Purchase price: 415,000
Repairs: 117,659
ARV: 605,000
Hard money loan: 423,500 (11.99% interest)
Holding time: 4 months
Interest: ~$14k
Agent commission: 4% (3% buyers, 1% sellers)
Staging: $2400
Design: $3000
Builder's Risk: $3000
Property Tax: $4000
Utilities: $900
Other purchase fees (loan origination, title, survey, appraisal, inspection, lender fees, etc): $16,507

Thanks!