We closed on the sale of The Power House last week…
We originally planned to hold this one as a long-term rental, and even had it up for rent for a while (and got LOTS of interest and applications), but as we were going through the process of pre-qualifying potential tenants, we realized how much we disliked the idea of rentals (as we seem to realize every time we buy a potential rental). And, as usual, I’m sure we’ll regret selling it in the not-too-distant future.
We then listed it for sale at $90K and over five months, got it under contract 3 times with potential homeowner buyers. Each time, the sale fell through due to financing issues, and each time we dropped the price a bit. Finally, we decided to just sell it to another investor who could pay cash. We ended up selling it to an investor/friend who’s bought several of our “rental” properties over the past couple years, with the entire transaction taking less than a week.
Had we been able to sell to a homeowner, we likely would have made about $15K more in profit, but after three deals falling through, I was just glad to be rid of it. Here is the breakdown of financials for this project:
On slimmer deals like this, it shows how much having your license helps. Good to remember.
Hey Shane,
Absolutely…if we had to give away 6% on the sale of this deal, it may not have been worth it…
flipping house seems like a very good business idea. though no one have actively done this yet here in my place (davao city), I really would like to try this in the next few months – given the budget. thing is, all sample deals are usually based in the US. No data for philippine market. I still have to dig further before I take the plunge! wish me luck
For a five month hold that is not a bad profit at all…
I agree with your dislike for rentals which is why I sold one of mine too. There is nothing wrong with rentals but it’s such a different business from flipping. I understand and like the long term investment potential of a rental but it’s so hard to overcome the “hassle factor”…
Great Flip!
I see you trying to hide this from me. I finally won a bet!!!
Ezra – ???
I understand and like the long term investment potential of a rental but it’s so hard to overcome the “hassle factor”…–> just like it is so hard to overcome “hassle” factor when it comes to managing subs who decide to steal materials or never show up on time …it is all about SCREENING. that’s the name of the game .. u screen well u sleep well … Id rather have rental be empty for 3 months than settle on mediocre tenant …have 7 rentals so far and the business is great. I plan to HELOC and invest in flipping though to diversify …