Financial Details of the Walnut Creek Flip (Flip Numero Uno)

When I was first looking into real estate flipping while working at my last (ever) job, I was disappointed by the relatively few sources of actual numbers for deals similar to those in the San Francisco Bay Area.  Most of the deals I saw were either 1.) deals on Flip This House, Flip That House, Property Ladder, or some similar delusional show about flipping in Fantasyland where carry costs and broker fees somehow pay for themselves outside of the deal, or 2.) deals in areas where the purchase price is $150,000 for a 4 bedroom house on 2 acres.  The reality in the Bay Area is housing prices approaching $750,000 for a 3-bed 2-bath starter home, where the deals with the ability to make a return proportional to the amount of risk are few and far between. 

The link below is the ‘Results’ page in my Excel Pro-Forma model. 

Download walnut_creek_flip_final_results.pdf

This was my first flip, and was certainly not a home-run (more like an infield single), but I wanted to give an idea of the numbers.  The house was an REO, and was in really bad shape cosmetically, as well as a few structural issues.  The list of renovations includes, but is not limited to:

• replacing the existing wall heaters with central heat and AC
• replacing the roof
• $20k in landscaping to demo the existing cracked concrete and installing retaining walls, sod, irrigation, paver patio. 
• Upgraded electrical service to 200 amps from the existing 120 amps.
• New dual-pane windows. 
• Reframing the sagging living room ceiling to create a raised soffit ceiling with recessed lighting. 
• Replaced the outdated stone façade with architectural stacked slate
• Structural changes to create an open floorplan, double the size of the front bathroom, and create a washer/dryer area. 
• All new crown molding, baseboards, window and door casings. 
• New French doors to rear patio to replace the non-functional slider. 
• New exterior doors. 
• Replaced all interior doors with 6-panel doors. 
• Completely revamped the floorplan of the kitchen with over 20 feet of granite counters, new cabinets, and a peninsula that adds 2 new rows of cabinets. 
• High-end stainless Jenn-Air and Kitchen-Aid appliances. 
• 8-foot granite and slate built-in BBQ for the patio area.
• Master bath with new jacuzzi tub, marble counters and tub surround, and travertine floors.

More on this flip to come…