Planning A Flip

What exactly goes into planning a flip? Where do you start if you are flipping your first house? It’s imperative to know how to analyze recent sales histories within the subject’s neighborhood and other similar neighborhoods within close proximity. It is also very helpful if you know your local and global market conditions, local geography, and the general lay of the land. Once you are capable of arriving at a confident after repair value, you need to have a solid understanding of material and labor costs…numbers. This will be a very elementary approach to the numbers, but it will give you some insight into the thoughts when planning a flip.

Please give a warm introduction to our newest renovation project! Located in the Fairfield neighborhood of Kempsville in Virginia Beach, this home already comes packed to the gills with awesomeness. The current upgrades include the following:

Roof was installed 5 years ago
HVAC system is a brand new high efficiency *Brand
The crawl space was encapsulated by JES
It has a pretty large addition making the total square footage over 2,500
It’s in Virginia Beach

Let’s get into the deal specifications:

Close date: 03/31/2023
Purchase Price: $315,000.00
Renovation Budget: $104,000.00
As-Is Value: $430,000.00
After Repair Value: $544,900.00
Gross Profit: $126,840.00

Because this is such a great property, there are a few different ways to skin the buffalo as some might say. For starters, we did close on it and we do own it outright.

Option 1: Instead of wholesaling or assigning this home to another investor, we can just sell it if the price is right to one of our investor partners. This stops us from demoing the property immediately though because a few investors might want to have the property provided turn key with a tenant in place.

Option 2: The second more favorable option is to clean up the property and list it for sale at the as-is value. Again, rather than doing a contract owner or novation style listing, we actually own the property outright so all the sloppiness doesn’t exist.

Option 3: The third option is to move ahead with our demo plan. This option requires plans to be drawn, permits to be pulled, and a 3 month renovation timeline. It also includes four different renditions of a renovation plan. Small, medium, and large for instance and the fourth is a plan derived from the other three plans…the master renovation plan.