This weekend marks three years since we purchased our very first rehab property, so I thought I would spend a bit of time recapping what we’ve accomplished in the first three years, along with some of the statistics and interesting tidbits of our journey.
Here’s a quick recap of our accomplishments:
- 24 Houses Purchased & Resold (Every One Profitable!)
- 5 Mobile Homes Purchased and Resold (4 out of 5 Profitable)
- 2 Houses Held as Rentals for Short Periods
Of the 24 houses that we purchased and resold, the level work completed breaks down as follows:
- 18 Full Rehabs
- 2 Minor Rehabs
- 4 Wholesales to Other Investors
In addition to the 29 deals that we did directly, we’ve also started carving out a niche helping a couple other investors with their rehab and resales. My wife has staged nearly a dozen other properties for other investors (including a model apartment for an apartment complex), we have managed several rehabs and we have listed and sold several properties for a couple very select investors.
Some financial statistics of the 24 houses purchased and resold:
- Total Profit on Flips: $478,083.10
- Average Profit Per Flip: $19,920.13
- Minimum Profit: $3,416.21 (House #1)
- Maximum Profit: $40,487.06 (House #16)
- Average ROI: $94.37%
- Average Annualized ROI: 421.80%
Also worth noting is that by having our own real estate licenses, we have saved or earned over $82,400 in commissions over the past 3 years. That about one-sixth of our total profit.
Of course, those numbers don’t take into account the cost of employees (myself, my wife and our project manager) nor the overhead costs of the business. Between the costs of being real estate agents (my wife and I), the cost of equipment, vehicle maintenance, staging furniture, etc, we actually spend a good bit of the profits, though I don’t have the exact percentages. So, don’t assume the numbers above are what we’re taking home — it’s a pretty good business, but not that good!
In terms of our rehabs, here are some interesting statistics:
- Average Purchase Price: $47,541
- Average Rehab Costs: $24,242
- Average Rehab Project Time: 28.5 Days
- Average Sale Price: $101,108
- Average Hold Time: 103.4 Days (not including the two rentals)
One of the places where we’ve been tremendously successful is in marketing and selling our properties in this tough market. While many investors have properties sitting for months on end and/or selling for far below what they expected, so far we’ve been very good at getting properties sold quickly and near our expected sales price:
- Average Time From List to First Contract: 17.9 Days
- Average Time From List to Final Contract: 43.0 Days
- Longest Time Property Took To Sell: 184 Days
- Shortest Time Property Took To Sell: 0 Days (Twice)
- Average Sale as % of List Price: 95.2%
Probably my favorite stat above is the 95.2% of sale price to list price. This means that on average, we sold our houses for over 95% of what we *ORIGINALLY* listed the houses for. Even in rare cases where we had to drop our prices, the average was still tremendously high.
Lastly, it’s nice to know that we’ve had a small little impact on our local economy. In addition to rehabbing 24 properties, which inherently improved the neighborhoods where we buy, we spent a good bit of money doing so:
- Gross House Purchase Costs: $1,141,000
- Gross Sales Revenue: $2,426,600
- Total Spent on Contractors: $465,000
- Total Spent at Home Depot: $117,000
It’s amazing that in three years, we’ve bought and sold over $3.5M in real estate and have spent nearly $600,000 on renovation costs.