Real Estate Riches: How I earned $30,000 on my first deal.
Real Estate Riches: Learn how to earn $30,000 on your first wholesale (flip) deal!
My favorite game as a child was Monopoly. Once I became a teenager, no one in my family would play it with me anymore, because I always won. Somehow, I always knew I was destined to invest in real estate. But how could I make real estate riches? Monopoly money doesn’t pay the bills!
For my first deal, I decided to fix and flip a property. I bought it from an estate attorney, it was a probate. The previous owner, took immaculate care of the house. While many things in the home were outdated, everything in the home worked! The comps in this area were between $90,000 – $100,000 f0r this home. I knew in order to sell it fast, I would never get close to that figure. Holding costs can eat into your real estate profits pretty quickly.
I could have used transactional funding, private money, or hard money to fund this deal, and still earned over $25,000 in real estate profit. The reason I decided to use my own funds, was simple. I worked hard for that money, and I certainly wasn’t going to squander it on unnecessary repairs or upgrades. That being said, there is nothing wrong with borrowing money. If you treat it like your own (wisely.)
The thing I can tell you about real estate is this. Like Monopoly, real life real estate is ADDICTING. Once you receive your first check from a title company, the wheels in your head start spinning. You become fully aware of the potential real estate has to transform your life. All of the things you want in life, are now in reach. So I say GO for it. Don’t procrastinate another moment. Take action, start investing in real estate NOW. Start earning your own Real Estate Riches!
Analyzing My First Deal:
Purchase Price: $31,000 (Cash)
Inspection Cost: $300 (Cash)
Closing Costs: $1,000 To Buy, $1,000 To Sell (Cash)
Total Rehab Costs: $12,950*
Holding Costs: $1,450
Flat Fee Realtor: $3,000
Total Cost: $50,700
Sold Fast For: $81,000
Net Real Estate Riches Before Taxes: $30,300
* = Total Rehab Costs Break Down:
Spray Paint Kitchen Cabinets: $1,000 / New Hardware Kitchen Cabinets: $200 / New Granite Counters (Remnants): $1,500
New Kitchen Floor: (Material only) $400 / New Kitchen Appliances: $1,800 / New Bathroom Vanity: $250
Bathtub Refinishing: $400 / New Hot Water Heater: $400 / Electrical Work: $2,000
Heating & Cooling: $2,500 / Interior Painting: $1,000 / Hardwood Floor Refinishing: $1,500
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Written By: Derek Puleo & Laura Al-Amery.
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