Both House #8 and House #11 are both SOLD !!!

Fittingly enough, we bought them 2 days apart from the same agent and sold them on the same, just over 5 months later.

I have already posted pictures of House #8, but have posted very little about House #11.

It is a townhouse unit quite far from where we normally buy.  One of our favorite agents who now no longer works this area told us that he thought it was a decent deal and helped us get it at a quite price!!  It is a 3 bedroom, 2.5 bathroom unit that is 1,280 sq ft and built in the 80′s.  I am a little bit disappointed we did not decide to rent this one as it would of worked out quite well for us!

Front – Before

Front – After

Kitchen – Before

Kitchen – After

Master Bedroom – Before

Master Bedroom – After

This property was a great learning experience for me.  We accepted a really high VA Loan offer, and it took 21 days just go an appraisal through, as the money had to be transferred through all kinds of government agenencies.   NEVER AGAIN, will I accept a VA offer in this market coniditions.  The appraiser is assigned randomly and the appraisal came in well under the accepted offer number.  After waiting so long, we weighed our options and just decided to work with the buyer and take less money for it.  The agent made some great concessions and ended up making almost nothing on this deal, which I probably wouldn’t allow again, because it definitely affects their attitude toward the deal and getting stuff done.  Live and learn!

Glad to see this one closed!

Sorry again for the lack of activity, I have been swamped with a couple other businesses I’m involved in and getting our existing properties into escrow.

House #6: This house has been in escrow forever now, since March.  The buyer had credit issues that are now fixed, but the agent has not been ideal to work with.  I think she has been stretching the truth the whole way through (but what agent doesn’t ).  It is set to close within the next week, if it does not, I have an $8,500 earnest money deposit that I will be keeping (and won’t feel very bad about it), as they have removed all contingencies.

House #5: This one has also been in escrow for a long time.  We’ve put the property back on the market (and got an offer today), but my escrow officer has a connection at the loan company and it sounds like this one should go through with the existing buyer before the end of the month as well.  This one has been in escrow about 50 days now, which is a long but seems to be the norm on FHA sales right now.

House #8: This one has been in escrow 45 days now, and we have all loan conditions removed, just waiting for docs.  Should close mid-next week .

House #11: Apparently, I haven’t written about this one at all, but this one we picked up at a sweet deal!  We accepted a really high VA offer, but VA appraisals are assigned randomly and the appraisal came in $28,000 under what we had it in escrow at.  We had a couple backup offers that fell through, so we did some fancy negotiating but still took a $15,000 hair cut (from original).  Luckily, it is a meaty deal, so there is still pletny of profit.

House #4: I will write about this one and upload some pictures.  We put it in escrow about two weeks ago, appraisal was good and we’re have a strongly qualified buyer, so I am hoping for smooth sailing.

The good news, if everything goes as planned we should close four properties before the end of June.

The bad news, we’ve looked at over 100 properties in June and probably made at least 50 offers.  So far we’ve missed everything, and not by just a little bit.  The moratoriums have really made the market go haywire.   One property was listed at $89,000, we were willing to pay $115,000, it ended up getting 40+ cash offers and went into escrow at $144,500.   Just amazing!  We’re going to keep on looking, hopefully I’ll have some time to catch up on the older blog posts.

If you have been reading the blog you know that our market seems to have become busier.  It seems like everything out there, priced anywhere near market value has multiple offers.  Banks seem much more realistic with pricing and buyers seem much more motivated (and not afraid to offer over asking price).

This is causing problems with appraisers.  It seems like prices are all over the map.  Some properties are cheap, other properties are expensive.  Quality of the inventory has a ton to do with it.

House #6
We got multiple offers on this property.  One was quite a bit over asking with the buyer asking for 6% back after closing (even when we calculated our net, it still is over asking price).  We put the property in escrow and the appraisal came back at $5k less than closing.  We negotiated a bit and ended up taking it most of the $5k out of what we were willing to give back to the buyer.

House #8
We just got an offer slightly over asking price, but appraisal is going to be a problem on this house.  The house is clearly worth what they offered, but most of the inventory is not in the same condition as our property.  I had our appraiser take a quick look, and it looks like the appraisal will be $10k low.  The buyer’s agent said his appraiser thought he could pull of their offer number.

The problem is, most buyers are new buyers, and need concessions at closing. There is also heavy competition on the well positioned properties in this market.  As the market shiftss from down trending to flat this problem will continue to get worse.

A willing buyer, a willing seller, but not bank willing to write the loan because the property does not appraise high enough… anyone investors willing to finance in this down-trending market?  I know I’m not!

Add this to the list of things for all you fix and flip investors to be cautious of.  Hint if you focus on the lower end of the market (buy properties really cheap and sell cheap), you will have less issues.

Last update I mentioned House #8 had quite a bit of interest.  We have got a lot of non-agent calls off the sign and overall a lot of action on it.  I was surprised we had not received any offers yet.

Friday afternoon, we got a call from an agent that she was faxing in an offer.  One hour later, we have a decent offer (a little bit low), but still about what I was originally anticipating selling it at.  I was out for the evening and she sent the offer in at about 7pm, so I did not get a chance to respond.

I left a message this afternoon with her, to talk about the details and see if we could make a decent counter.  Another agent ended up emailing in an offer.  This offer is very solid, $5,000 earnest money deposit and we would end up netting over our asking price!  The agent mentioned that the client could do FHA or conventional, but obviously, would prefer FHA. This afternoon I called the agent and discussed we could not do FHA until April 28, so let’s pursue the conventional end of the offer.

He is going to work on the final details of the offer.  I think our biggest challenge on this one is going to get a good appraisal on it.  I looked for comps and really cannot find anything in the range of this offer.  The agent mentioned he discussed my concerns with his appraiser and he thinks the number they submitted the offer at was doable.  We will see.

So hopefully, by next week we will have two houses in escrow!   House #6, is moving through escrow pretty solid, but the appraisal came in at $5,000 less than the offer, we renegotiated the amount we would give the client back.

We are no in full force looking for properties anywhere we can find them.  The market is busy, though.

While I am busy putting all my paperwork together for tax time, I figured I would take a break and write a blog post.

House #8 is finished today.  We are sure proud of how it turned out.

Before

After

The outside of this house was pretty good and we did not end up changing very much.  We only ended moving one palm tree.

The biggest difference is in the kitchen.

Before

During (Yuck)

After

One more picture…

During (I guess I did not take a “Before”)

After

So I listed it Friday at 4pm.  I got 3 phone calls Friday night.  We even got an offer, someone without an agent, who called based on our sign wanted to negotiate a little bit.  It is listed at $239,900 and he made an awesome $160,000 offer (telling us we where too high) – LOL. Obviously, I turned it down.

This wasn’t my favorite house, it is in a great area, but our margin is pretty tight.  The city this property is in we have never worked in, so I am not really comfortable with pricing in the area.  After all the action I am thinking we are going to do well on this property.

One agent that called did mention she was going to bring a client who can make VA offer (which I think is not affected by the 90 day FHA rule).  If they brought an offer, it sure be nice to put this property in escrow and close it far before our 90 days are even finished!

PS:

House #5 we are having two different agents hold an open house tomorrow (at different times).  This house is less than a mile from House #6 which we got five plus offers on.  House #6 is listed 20k hire, but has a 20,000 sq ft lot.  House #5 is still a large lot, but only 9,700 sq ft.  I can’t see that making such a big difference.  Hopefully, we will get some offers coming in.

House #8 has gone along quite smoothly.  The market seems to have really dipped in this neighborhood, so I want to get it up on the market as fast as possible.

We decided on a new style of cabinets as we did not love the ones we got for House #6.

Carpet should go in Friday or Saturday and we should have it on the market by early next week.

I had to drive all the way to the city this house is in to get the water turned on and bring them a money order!  No other city has made me do this.

I have been so swamped with my other work, so it’s been difficult to update regularly.  Everything has been moving along quite well.

I have not had time to post very much lately.  I wish I could say it was because I was off on vacation, but we have been swamped closing properties, getting permits and fixing what we got.

House #3 – In Escrow (or Close)
This house should be in escrow today at a solid above asking price offer.  There has been two or three days of delay getting it into escrow, but it seems like the buyer is thinking it is his already, which makes the chances of him closing pretty high.  Crossing my fingers.

House #5 – On Market
We finished repairs on this one and had an open house this weekend!  Because of the FHA 90 day flip rule we have listed it quite high and have about 45 days before we can even take an FHA offer anyways.  So we are planning to just sit back and see if we can somehow get a conventional offer.  I will post some pictures of the finished product shortly.

House #6 – Under Repairs
Our contractors have been hitting this house hard!  It is starting to look awesome.  Our budget one this one was $30,000 and it really shows that we can pretty much make the house totally brand new in 30 days for that amount.

Fire Place – Before

Fire Place – After

House #4 – Just got Permits
House #4 is a huge job!  We closed in October and tore it to the studs and worked on getting permits for a 500 sq ft kitchen addition.  We got this property real cheap, and it’s in a pretty good neighborhood, so we are going to do well, but it might take a little while along the way.

House #8 – Should Close Escrow this Week
We should purchase this house tomorrow.  Our repair budget is a cheap $14,000 and we are hoping to be in and out in about a week, but we will see.

Will post some before and after pictures of House #5 shorty!

House #8 is one of the deals we are working on that is out of our normal property farm.  It is a bit of a higher end property compared to what we normally do, but still well under the areas median homes prices.  We have had it under contract for about three weeks now and we are ready to close, but there seems to be some sort of title issue that is holding closing up.

We have a really basic $10k rehab in mind and we are going to try to list it cheap and try to sell it conventional (to get around the 3 month FHA rule).  The house needs a bit of landscaping, some paint and flooring and maybe a bit of work in the kitchen, we are undecided how much we are going to update it.

From the picture the curb appeal is pretty good, and it is in a great area so we are hoping for a fast sale.

House #9 Update
Our purchase transfer recorded with the City today.  The buyers funds are in escrow, so their transaction will record tomorrow and I should get my money back.  Makes for a pretty uneventful transaction which is nice for a change!