Well, we finally closed on Friday and now I can do the big reveal on our financial specifics. In case you missed the big reveal on the way everything looked, check it out. I'm super proud of our work. I shared our original projections back when we first bought the house. We were WAY OFF in a good way. As a re-cap: our projected profit was $13,099. That was a purposely conservative projection, which made us feel good about this investment. We figured that we would probably make more. We didn't anticipate how much more our profit would be! Here are the details: Purchase price:$ 155,000 Rehab costs$ 38,732 Holding costs:$ 5,017 Closing costs:$ 7,923 Realtor fees:$ 13,750 Sale price:$ 275,000 Profit:$ 54,578 Obviously, the biggest error in our projections was sale price. We had expected to sell for $235,000 and ended up selling it for $40,000 more than that. The market was on fire when we listed the property. John and I argued a bit about the listing price of the house. I was arguing for much lower (I'm embarrassed to say this, but I was saying $249,900 to get at those with a $250K max price). John, my realtor boyfriend/business partner, had done the comps and wanted to list ...
About to put in an offer
So, you probably guessed I would move forward with this idea. Of course I have my reservations, but I can’t not try this. John and I have discussed the business arrangement and have come to an agreement on how to handle it. I will start an LLC and provide the finances and John will bring the knowledge and expertise. He will manage the subs and make sure that the budget is all going according to plan. He will also teach me the system that he created for both assessing a potential flip and managing the project. John brings a lot to the table, including being a licensed real estate broker. I cannot understate how important that is for what we are trying to do. We are able to go view houses immediately and on our own. He has access to the MLS and can do research on comparables. We identified a house in a suburb of Chicago. It's a 3 bedroom, 1.5 bathroom split level. It's in bad shape and needs A LOT of work. I don't want to get too far into the financial details at the moment because we haven't yet put an offer in, but I promise to ...
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