Read a client’s testimonial –
I feel like the story I’m about to tell is like the Lemony Snicket – Series of Unfortunate Events.
So . . . I thought it would be a great idea to invest in a fix & flip in Indiana . . . even though I live in Denton Texas. I would be partnering with a seasoned realtor/investor whom I’ve known for 25 years. I trust her implicitly and the house was in an up and coming neighborhood with an upside potential of $100K. What could go wrong?? Well let me tell you . . .
Original Scope: New mechanicals, roof, siding, kitchen and bathrooms, interior/exterior paint and refinish hardwood floors. Budget $75K
It didn’t exactly turn out that way.
• Before we even got started . . . the house was completely stripped – someone stole all of the interior & exterior solid wood doors, vintage bathroom sinks, leaded glass French doors, floor grates and more. The police response was “What do you expect, this is the hood”. The insurance response was “If you file a claim, the rates will go up on all of the other properties you own”.
• It didn’t matter much anyway because the insurance was cancelled because the house was no longer secure (missing doors & windows)
• After the demo, we discovered wood rot and fire damage throughout and had to reframe more than 50% of the house
• The contractor who delivered the decking hit the side of the detached garage and knocked it to the ground
• We offered a day labor position to an area homeless man. He ended up getting mad and smashing all of our new windows . . . before they were even installed. He also threatened the contractors and my partner on numerous occasions so he was arrested and removed from the premises more than once
• The jobsite wasn’t properly secured and materials were stolen from the site at night
• The roof wasn’t tarped prior to shingles being installed and a heavy rainstorm ended up flooding the basement
• The architect we hired to design the new garage made an error on the drawing and the foundation was built in an easement. We had to cut off 2’ from the alley side and add 2’ to the other side but not before we had to pay for a staked survey to make sure we knew exactly where the building line was
• As the garage was being built, a contractor pulled into the garage and his brakes failed and he ran into the front of the garage (before it was even complete)
• Our general contractor added $17K in additional charges to the final invoice (without any prior conversation). By the way, he did a great job, until the last 2 weeks. His finishes were horrible and we weren’t able to get him to complete the punch list so we had to have a “handyman” finish up
• Because it was vacant, we had decided to have the house staged. Unfortunately, the person we hired to do touch ups ended up stealing all of the furniture . . . and parts from the furnace and selling them on Offer Up. Thank goodness we opted for the insurance for the staging items.
The good news is that we FINALLY sold the house! Unfortunately, the $100K potential was now gone and we actually lost money on the deal. Lots of lessons learned.