My FIRST FLIP - FINALLY!

I finally sold my first Fix N Flip! Very exciting! I must say the process took much longer than I thought, but I did it.

Bought the house for $40K after several negotiations. 3bed/2ba built in 1956 in nice neighborhood, considered a central location for Phoenix, AZ. It was a huge project to fix up and I knew what I was getting into, but still went over budget around $2500. The plumbing and electrical had been vandalized, the kitchen was a mess, painting was horrendous! BUT....I could see the potential. The house had been empty for 2 years, so I guess no one else wanted to tackle the job.

Got it with a hard money loan at 12%. A good learning experience as they made me hand in a detailed budget and disbursed the funds in three amounts after they checked the work finished. When I had my first walk-through with budget in hand, the ARV was $178K. Much higher than I had anticipated. My rehab budget was $33K.

Then....it sat on the market for quite awhile. The plan I had with my agent was to drop the price in $2500 increments every two weeks until it sold. I priced it just under market value at $143K to start...which was in January. (Even though it appraised at $178K, we thought by the comps it was more like $149K in Jan.) I had it under contract at one point for $129K, but then that fell through.

Finally I got it under contract again and closed escrow last Friday! The final sale price was $113K. Thank goodness I had really been watching the market and listening to statistics at my local RE meetings. I bought really low which allowed me to drop the price and still make a profit. After holding costs and all expenses, I'll make around $18K.

All in all I feel good about it and I'm ready to start another. My biggest mistake was probably buying a house without a garage (it had been converted into an extra room and I put in a closet and made it the 4th bedroom). The market here is still really low so all the buyers want a great deal even if it is completely new and remodeled. I picked a property that was in the median price range for this area, but my agent says that there is a LOT of activity in the price range below that. Anyway, the more I do the better I'll get with experience!