All Forum Posts by: Victor Eng

Thanks to everyone that commented on this. I'll take all advice to heart for the next flip! My mantra is that the way to get started (and get better) is to quit talking and start doing, so on to my next deal! I'm taking this off my active subs so I apologize if I do not reply. Feel free to reach me through PM.

 Bringing @Ann Bellamy into this post too.

When I ran comps I actually came up with the $650,000-$670,000 range. The $699,999 original listing was more of a "let's see if anyone will fall in love with this house and take it". Unfortunately that was a fail and the mistakes on the flooring did not help it, so we lowered it to $669,000 after the first open house. I was planning to redo the floors, but the staging was already there and it would've been more money down the drain.

I knew the kitchen spray down and fixover was going to be in that price range (It really was that good!), but the cost of painting throughout the other parts of the house really blew me over. A normal size bedroom in these parts costs $300-400 for ceiling trims and walls, so I vastly understimated it for this project as there were bigger rooms, catheral living room ceilings, foyer and hallspace. 

The landscaping was hard to judge because of the snow at the start of the project, so I budgeted $2,500 for quick sprucing up, but ended being $6,000 because of all the dead patches and the need for re-seeding. 

The carpentry mis?-estimate was completely due to inexperience. I had to bring carpenters back again and again to fix shower doors and misc BS so I ran up the bill there. 

My all in project cost was supposed to be around $580,000 ish. I figured if I could get 660k, it wouldve been a nice 50k profit for 6 months worth of work, but obviously it didn't turn out that way.

 Thanks! I used Benj Moore throughout. Walls were baltic gray and trims were China White. 

 The interior painting was a bit pricey in my opinion as well, but the kitchen cabinets refinishing with spray paint was very well done and was the focal point of the house (kitchen).

Yes, we should have waited it out, but we needed a fast close and didn't risk waiting. We did include a kick out clause and had another buyer come in at 660k 2 weeks after our first offer. But the original buyers waived their contingency and we had to go with the same deal. It would've been a 15k profit increase. Sad =[

 Thanks! Ugh, it was too much effort for too little $. As I say earlier though, the experience was important so that I can profit more next time. Basically, the finished floors were not that great with some streaks and varying tones of stains. I was quoted mutiple prices, from 1.50 a sqft to 2.25. The hw floors were roughly 2700 sqft or so, so I went the cheap route to save 75 cents per sqft. I will never compromise quality the next time I do this, especially not on floors.

It was an auction repurchase as my company had interest on the underlying mortgage note. This didnt give us an advantage or anything as the next highest offer at auction was 415k or so. Rather not release town information, but if youre from MA, you can do a quick MLS search and get your answer.

It was not personal funds. It was off of the company I'm working for LOC cash.

Hi All -

My first flip closed yesterday, mostly cosmetic, and I wanted to share my experience with you guys. This was done in Massachusetts. I'll try to make it concise but it may get a bit lengthy!! I pretty much broke even with this deal and I want to share where I messed up and will be sure to catch next time around! Let's get started! The numbers first:

Purchase Price: $430,000 (Auction) (3 Normal Bed, 1 Master, 2 Full Baths, 1 Master Bath, Pool, Cathedral Living Room Ceiling, Attached 2 car Garage, Swimming Pool, 3500sqft on 1 acre)

Outstanding Town Liens: $94,000 (I knew this as this was announced at auction. I thought it was a mistake. But taxes are about 10-12k per year on this property and the previous homeowner was delinquent for several years)

Cash for Keys: $20,000 (The homeowner agreed to vacate by a certain date to avoid a drawn out legal process, which they threatened to do)

Cleanout: $750 (The place was a complete mess)

Initial Cleaning: $150 (I at least needed to get the place tidied up a bit before painters would come)

Kitchen Repainting / Spraying Makeover: $11,500

Fresh Paint on Most Rooms (Ceiling, Walls, Trims): $12,500

Hardwood Floor (Sand, Stain, Re-finish): $4,500 

New Carpets in all 4 bedrooms: $4,500

Lawn Debris and Hydroseed: $6,000 (and weekly lawncare until sale but that was cheap)

Electrician: $1,000 (Smokes Inspection and fixed a few recessed lights + other minor)

HVAC: $1,000 (Garbage Disposal Replacement, HVAC filter replacement + others

Window Cleaning: $500

Mold Remediation: $1,000 (Bathroom Ceiling)

Carpentry: $5,000 (Bunch of stuff)

Miscellaneous Materials: $2,000

Final Cleaning: $300

Staging: $4,500

New Washer and Dryer: $1,000 

Total: ~$600,200 (+- 2-3k)

Listed Price: 669,000

Sale Price: 644,500 

After broker + legal Proceeds: 606,000

Profit: ~6k 

Time Held: Bought in April, Roughly 6 Months.

I didn't make much from this deal, but the experience I got was awesome. I tried to cheap out on the hardwood floor vendor, so I got a lot of negative comments from buyers and had to wiggle on price. The painting of ceilings was also unnecessary in hindsight, and think I could've gotten away with that. I also did a lot of the above things sequentially, instead of having multiple vendors in the house at the same time. I think I could have gotten away with certain items, especially the landscaping. I did that too late and needed to wait 3 weeks for the sprouting so it would show better.

PICTURES (BEFORE)

AFTER PICS

@Gilbert Dominguez 

Thanks for all the input. Will probably end up being a renter temporarily.

BP,

I recently maxed out my leverage (my PITI is 42% of my gross income) in order to purchase my first owner occupied property (I put down <20%). I am planning to purchase a second property in a few months using the same financing (<20% down) and then rent out my current property to cover all of the first property's PITI. Has anyone successfully executed this strategy? My concern is that no lender is going to lend me until I get my first property rented out. It's a catch 22 as I cannot rent it out until I buy/rent another place.

What should I do?