2001 WR – Our First, “Official”, FLIP !

I originally found this property while filtering on Propstream – it was a failed listing (for $150,000) that was owned by an estate. I sent a total of 37 letters out, including one for this house. 

I never got a response, however, I analyzed the deal based on the listing photos and my comps.
It popped up on the MLS a month later (I’m not sure if my letter helped expedite this or not, but I like to think so ;). It was already on my radar, so I let me agent know and he scheduled a showing for the next day.

Asking Price: $60,000

ARV: $135,000 (very conservative)
Estimated Rehab: $35,000

Max Allowable Offer (MAO): $55,000

Anticipated Profit: $30,000Purchase Price: $49,000

The original rehab estimate was completed with my contractor. He walked through with me and my agent.

I plan to completely renovate the bathroom, add an actual 2nd bathroom on the first floor, change the layout and add a breakfast bar to the kitchen by removing the wall between the kitchen and dining room, freshen up the basement, update some electrical to replace the exposed knob-and-tube and bring it up to code, replace all windows and entry doors, and replace the garage doors. 
I did not know the condition of the furnace but assume that I will need to replace the central air conditioner since it looks rough.

None of the 2nd floor receptacles were grounded and the panel wasn’t going to cut it. I had a 200A panel installed and every wire in the house replaced. I still need to run a circuit to the garage and install a GFCI on the front stoop and one at the back patio.

Although I got the house for $6,000 less than the original MAO, I still want to go forward with the original plan. I spent more on electrical than anticipated ($4,200 versus $3,000) by doing a lot of the work myself, but, there are still a lot of big ticket items left that can easily inflate my budget and I don’t want to take any chances.
Here is a short list of some of the bigger items so far:
  • Central AC – $3,000
  • Electrical – $4,200
  • 2nd Floor wall and ceilings painted – $1,200
  • Bathroom Drains and Gas Lines to Kitchen – $1,235
  • Windows (Material Only) – $5,733
  • Cabinets (in-stock, material only) – $1,375
  • Flooring (labor & materials) – $3,325
  • Soffit, Fascia, Gutter Repair – $1,200
  • Tub and Walls – $520
  • Exterior Paint (material only) – $250
  • Basement Paint (material only) – $140

Lessons Learned

I did not plan to tear first floor ceilings down to studs – the ceiling tiles they used were not repairable and too uneven to drywall over. After removing the tile, the glue was so thick that it, and the plaster/lath it was stuck to, had to come down. Ultimately, it made installing drywall much easier.

Everything takes longer than expected.

I saved $2,000 by running the receptacles on the first floor myself. It was the first time I ran that much electrical behind existing walls and it was actually enjoyable.


The house received an offer of $1,000 above our asking price of $159,000 and the buyer put down 35% towards the purchase price. The escrow process went by without a hitch, the only thing we addressed during the inspection was a slightly drooping gutter – I think one of the hangers may have pulled out while we were painting the exterior.


All in all, the project took a little longer than expected but the final product is something the we are very proud of. The quality of work is miles ahead of what many “flippers” in the New Castle area produce.