House flipping

getmore4less

house was purchased for 85k and now up at 145k

That's only 70% more than they paid for it.

squirrelchops2

For me, who has 'flipped' and I hate that terminology but will use it, there is not enough profit to be made according to your figures so I would walk away. £145k sale, needs £20k spent on it (although I would say you could get that work done for less) with other done up houses going for between £160-£170k. No, not enough for me unless I was considering a long term BTL.

That and the fact someone has done half a job would concern me - what bodges could I potentially uncover?

Phil4432

Kez1357 said:

Hi. Iv seen a house I like and put a offer in. Solicitor has picked up the seller has only owned the house for 3 months and bought it cheap to renovate & flip. 

It still needs quite a bit of work to finish it off but there asking double the price what they paid for it 3 months ago. 

It’s in a popular area and priced fairly, should i be put off ? 

Thanks 

Double the price to three months ago?!  Walk away.

theoretica

As others have asked, can you find out the background to the sale 3 months ago?  Sometimes there are personal reasons and the sale price was not a fair open market one.  Was it actually worth only 85k 3 months ago or was there more going on?

[Deleted User]

Kez1357 said:

Thanks for the reply’s :-) 
house was purchased for 85k and now up at 145k. 

Yes I think they have made it mortgageable. It still needs around 20k spending on it to bring it up to standard.(new bathroom / kitchen/ double glazing etc) 
same houses in the area are fetching 160-170k (but very rear come up for sale and when they do they go instantly. 
Yes, it’s registered on land registry &
It’s freehold 

thanks  

20k sounds low for a new bathroom, kitchen and double glazing.

Markneath

Unless its a very big house but 145 suggests not then, 7k for double glazing, 13k for bathroom and kitchen, 20k is ample. 

I would usually get the wiring,and some plastering done along with the above for 20k, obviously different areas have different prices though.

peterhjohnson

Kez1357 said:

 the seller has only owned the house for 3 months and bought it cheap to renovate & flip. 

I would be wary of buying a flipped house anyway. The reason being that  the flipper has no incentive to do a good job. I'd much rather buy a house where any improvements were done because the seller expected to live with whatever had been done and had sold for personal reasons some years later.  

(Same reason I'd never get a seller to fix a problem prior to sale instead of getting a reduced price and using the saving to get it sorted properly after completion)

As for a half-flipped house...no way, not unless you realy realy know what you are doing!

FreeBear

peterhjohnson said:  As for a half-flipped house...no way, not unless you really really know what you are doing!

Sis was (briefly) looking at a part completed flipper house in Diss. Some of the internal stud walls had been knocked out and plasterboard piled up ready to go on the walls & ceiling. One small problem - Grade 2 listed and no planning application had been made. I suspect the Conservation Officer had shoved a spanner in the works.

TripleH

You can find the information on rightmove or if you do a Google search of the full property address (he says) as we found the previous advert for a property we were looking at to see what had been done.

I'd do that to see if you can identify if they have done any work at all. Could be they bought undervalue and seeing how prices have risen are selling now without the hassle and expense of doing anything.

[Deleted User]

Markneath said:

Unless its a very big house but 145 suggests not then, 7k for double glazing, 13k for bathroom and kitchen, 20k is ample. 

I would usually get the wiring,and some plastering done along with the above for 20k, obviously different areas have different prices though.

Apparently the tradepeople where you live are extremely cheap.

Around here you would be looking at double that, especially with wiring and plumbing included. With wiring and plumbing you might also need to add in some costs to move out for a week or put stuff into storage.