People & Society

As always, the way I will try to stand out from other write-ups and try to make this information be worthwhile to people interested in this field, I will be as accurate as possible when it comes to the numbers (prices, timeframes, etc). My father moved here from Europe in 2010 with about $90,000.00 to his name. He was an architect by education and business owner by trade (owned and operated cafe/restaurants for 35 years). Bad investments and life circumstances ate away at most of his net worth. He remarried in 2009 and decided to move closer to his son and daughter, packed his bags and stayed in 1 bedroom rental in Alexandria Virginia.

After a few months of searching he realized one key thing – the properties in his price range were either in horrible need of renovation or renovated in bad taste and overpriced. Since he wanted to purchase a small paid off property, the ladder was not an option. He eventually settled for an odd shaped 1 bedroom condo in Springfield Virginia at the very top of his budget, for about $90,000.00. While still trying to figure out what to do as a source of income, he decided to take a major personal risk and borrow $20,000.00 from his brother-in-law to renovate the condo. I like to include these specific details, to help paint a picture of where this all started.

The home was extremely outdated from the 1960s, and had some minor improvements done in the early 2000s. The improvements were low budget and traditional North American styling, which set a fire out under my father – enough for him to borrow money (very out of character) to remedy. He opened up the very tiny kitchen, replaced the old plywood cabinets with IKEA cabinets, and installed a single line of recessed lighting from the hallway to the kitchen. 1/3 parts spent on materials to 2/3 parts on labor, coming out to exactly $17,000.00.

My father had started working with a parter in the business of exporting cars from the US to Germany, and would stay in Baltimore once every two weeks to oversee the cars being loaded and shipped. His wife started to complain about the safety of the area they lived in – especially on nights he was away. After a few months of living there, my father decided to list the condo for sale in the hopes of moving to a better area. Listed at $145k, the condo had multiple offers the first week and went under contract at $150k and closed in 30 days. With about $9,000.00 spent on buyers/listing agent and settlement company fees + $17,000.00 on renovations, they walked away with $34,000.00 in profit.

They soon moved in to a condo in Alexandria close to where his wife originally lived. Purchase price was $126,000.00, again extremely outdated. Borrowing a small amount again, the condo was fully renovate for just under $25,000.00. While hosting a dinner party and receiving an incredible amount of praise from family and neighbors, my father felt he found his true calling. After applying for a line of credit on the home, the bank appraised it for $200,000.00 gave him $150,000.00. He considered this another win and his final sign to start his house flipping career. I will go into detail of his first actual flip in another post, as well as write-ups of recent flips where I was actually involved. I will go into specific detail regarding how we find our properties, how we decide on renovations, specific numbers on materials, labor, time spent on the property and the carrying/holding costs associated.