House #17 Time for Another House Flip

October 2014

6503 Brokerage Divot – once again, we had to flip a property to get some cash. This house was just like the rest; our yellow letters were working incredibly well.  A single guy owned this home who was freshly divorced, and all his kids had grown and left the nest. He worked for many months at a time, internationally, and did not need this house anymore.  He had paid it off, and he wanted to sell it quickly. Luckily as you can see from the pictures, he had kept it very clean. He had even replaced all the molding and door trim. It was built in 1977, contained 1,320 sqft, and four bedrooms, two baths.

House Purchase Details

We got this house under contract for $72,000 with $2,000 back at closing as a seller’s contribution—# Steal.  We paid cash from our credit lines and our cash reserves.

Flip House Pics

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Flipping a House for Huge Profit

We thought about keeping this house as a rental for about 14 seconds. We would’ve secured a loan for about 80% of the value of the home and then rented it for $1,200. However, instead, we decided to list it on the MLS and sell it for $90,000.

Remember our formula for deciding if to keep and rent or flip and profit? If we can get five years of rental profits in one fail swoop from a flip, we will do that every time. So here’s the math in this case.

We would make approximately $250 per month in profit if we rented the property. Multiply that by 60 months (5 years), and you get $15,000. If we were to sell now, we would get $20,000 minus buyer’s realtor fees and closing cost, which is about $4,000, leaving us with $16,000.

We pulled the trigger.

After it was all over, we cleared $15,700. It took us six days to close it, as the buyer was paying all cash, so this went as smoothly as possible.

Buy and Sell HUD Statements

 

 

 

 

 

 

 

 

 

Net Worth Update

This property is the last deal we did in 2014—a big year for us. We will do a net worth progress post next to see how far we’ve come. Again, these deals might start to sound repetitive, but we know from what we’ve been preaching all along, small repetitive, positive activities will build huge dividends over time. You will see in a future post how much each of the deals is setting us up nicely for Financial Independence.

 

 

 

 

 

 

Stay Stealthy!

Read about House #16 or  House #18