Flipping A House

I got caught up in the real estate frenzy like everyone else. It was an opportunity to make money, loans were plenty, and easy to get. But, like everyone else, I got caught on the bubble burst, and although it would be easy to say it was the economy's fault, that is not entirely true. First off, and probably my first mistake, was to find a house that I got emotionally attached to. It was a great looking farm house, with a wrap around porch, built in 1910. It had such potential, and when I started it, everything was still selling. I had great plans for this property.

My second mistake was buying the property at a price that was too high. I felt at the time that it was worth it because I could make a killing on the sell. It was a 3 bedroom, 2 bath and an unfinished basement. I decided on making this house as nice as possible. Which meant, granite in the kitchen and bathrooms, wood floors, tile bathrooms, redesigning the rooms and tearing out walls. New windows, siding, electrical, plumbing. We even redesigned the location of the stairs. After tearing into this project, we found that there was no insulation on the walls, so we had to add that too. On the outside, we decided to side the whole house with new siding. New landscaping was essential to get that curb appeal. Then I decided that instead of a carport, to put an attached garage too. You can see how a simple project can become very complicated, and very expensive.

As much as I loved this house, it would have been cheaper to tear it down and rebuild it new. The appraisal was less also because the year it was built, even though it was basically a new house.
Any investment property is a risk. The key is to not over spend, sell when the market is good, list it at a fair price, and buy cheap. All of these principals I ignored because I had a project that I got overly involved in. The house turned out to be incredibly beautiful. In the right market it would have sold for more than I ended up selling it for. But, like everyone else in this economy, we still had to sell it and move on to the next project. Even though I loved the final product, I learned my lesson on what not to do when buying and selling an investment property.