The MLS doesn’t supply many deals, but sometimes you get lucky. We closed on the Greeley flip on June 13, 2018 for a purchase price of $260,000. Below, is the time frame and costs assocaiated with this flip. I don’t do very many flips, but when I come across something that make sense I pull the trigger. I felt the “after repair value” (ARV) was $330,000 and expected to put about $15,000 into the deal. It was actually a pretty “clean” property, in that it did not have a major layout flaw or structural/major mechanical issues. New carpet, new paint, a major clean and throw her back on the market. Here is the actual numbers and timelines for those who have not yet done a flip, or are so in love with HGTV’s glamorization of house flipping.
|5/27||Fully Executed Contract $260,000.00|
|5/30||Inspector and Floor Measurements|
|6/13||Close on Property $260,599.54|
|6/14 -6/17||Maintenance in Property|
|6/20 – 6/21||Carpet/Flooring|
|6/22 – 6/26||New Sod/Landscape|
|6/29-7/4||Final Details Prior to List|
|7/5||Live on MLS|
|7/24||Inspection Objection – 14 Items|
|8/10||Closed on Sale $335,000.00|
Total days from going under contract on the buy, to closing on the sell: 76 days
Repair Items and Cost
|Total ALL IN COSTS||$286,751.02|
|Less Closing Costs of $24,247.28||$310,851.35|
|Net Proceeds = $310,851.35 – $286,751.02||$24,100.33|
We didn’t have as much foot traffic as we would have liked when we put the property onto the market, but we did have the right traffic. Ultimately 12 people came through the property in the 5 days. We received one offer, which we accepted.
Our budget going in was $15,000 which quickly moved to $20,000 with an idea of it possibly hitting $25,000.
Although we made $24,100.33 on the deal, we had to risk $286,751.02 to get it. You have to ask yourself if it is worth the risk to sit. Every day we sat on the market was $54.20 in interest. Without the right buyer coming through the door and receiving that offer, the property may have sat. At which point, it begins to start accumulating interest. At that point you would have to ask yourself if you need to upgrade anything else, which costs more money and time.
What made this flip extra appetizing was that we were going to be able to take the commissions on the buy side and the sell side. At 3% that was $7,800 on the buy side and $10,050 on the sell. Without the extra commission dollars, this deal may have not been a deal. It is easy to look back now and see that at any time there could have been an unforeseen item pop up. The property could have sat for 30-60 days on the market. Although the money we made was good, we had some good luck on our side as well.
Flips are fun and the before and after are always great to see. If you’re not flips on a regular basis maybe think of another way to make a “quick buck”. Having the right vendors and processes is essential. Stress is a part of the process and also part of the fun. Be prepared to be flexible.