I got back from my vacation this past Monday and the news that deal #4 has finally closed was awaiting me. I don’t know if it was just summer time or what, but this deal took forever to get from accepted contract to closing. To be honest I even forget when the contract was officially signed and accepted, it must have been in early June.
In fact, our original contact with this seller was way back in March. At that point we negotiated a purchase price and contract of 45k and we were unable to sell the property so we cancelled that contract in order to renegotiate the purchase price. At first the seller wanted nothing to do with our new price (which was 35k). After some back and forth we decided to accept 42.5k. Yes we moved more, but we knew what our buyer was going to pay so we had room and were going to make some money.
So here are the stats for this deal…
Lead Originated: Out of State Owner Mailing – March 10th
After Repair Value: $ 130,000
Purchase Price: 42,500
Profit: 2,500
Repair Estimate: 60,285
Sold Price: 45,000
Closed Date: August 17th
For those interested, here is the repair estimate breakdown we had on the property.
Demolition and yard clean up:
- Dumpsters $2,000.00
- Int. and ext. clean up 2,000.00
- Tree work 4,000.00
Exterior:
- Stucco repair. 1,200.00
- Power wash and exterior painting 3,500.00
- Roof repairs 2,500.00
- Exterior doors 1,000.00
- Gutters 600.00
Interior:
- Ventilation of damp basement 700.00
- Electrical work 750.00
- Window replacement 6,000.00
- Trim work 900.00
- Drywall repairs 2,000.00
- Interior painting 2,500.00
- Repair water damage ( from running water) 2,735.00
- Flooring 4,000.00
- Total gut, mold remediation of bathroom 4,500.00
- Total gut and remodel kitchen 6,000.00
- Kitchen appliances 1,000.00
- New hot water heater 900.00
- Remove oil tank and replace furnace 6,000.00
Sub-total 54,785.00
10% for hidden costs 5,500.00
Total 60,285.00
This deal was very tight and we would have passed on it if we didn’t already have a buyer lined up and ready to go. We knew what our buyer would pay, so we negotiated the deal accordingly. Kudos to my partner for seeing this deal all the way through and making it work.
*** Deal Close Giveaway ***
As I said in a previous post, every time one of my deals close I will be giving away a prize to one of my readers. This is what I’m giving away this time…
Prize: Flip This REO E-Book
How to Enter: Post a comment below, any comment will do.
Winner: Will be announced on Monday
This is an outstanding e-book that answers everything you need to know about investing in bank owned properties.
Comment Now!!
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Congratulations. I really appreciate your blogs. This deal was much to skinny for myself, but you made it work. Keep up the great work you are doing.
Thanks Michael! It was indeed slim profits and most of the time would have been to small for us, but because of the confidence we had in our buyers we went for it and it worked out.
Great job Scott! Congratulations! Did you sell that to a fix-n-flip’er? Perhaps you made a bit more if you sold it to buy/hold(?) Anyway, a deal where you make money is always a good deal. Keep it up! I’m sure more deals will come your way.
Sold it to a fix-n-flipper. This house was definitely not going to be sold to anyone else, was a mess.
Congrats Scott.
Thank you Sharon. You’ve been putting some great stuff up on your blog lately, great work!
Congrats, Scott! I am looking to wholesale in Ocean County. I’ve been reading through your blog from the beginning, and am about halfway through 2009. It’s a big inspiration to see your success!
Thanks Greg! If I can ever help by answering one of your questions let me know.
Congrats Greg, you are the winner of Flip This REO! Shoot me an email and I’ll send it to you.