House #1: Under Contract

February 9, 2009 · 3 comments

I mentioned the other day that we had received an offer on The Corn House, but weren’t sure if it would actually lead to a contract or not. While I wasn’t confident it would happen, we were able to get the property under contract today, and we’re scheduled to close in early March.

This was the first rehab we’d ever done, and suffice-it-to-say, we’ve learned a lot since that project started. The biggest lesson was around forecasting financials and ensuring that we’re making smart purchases. It’s amazing how in less than a year we’ve gone from having no idea what to look for in a property to mentoring other investors on how to find, evaluate and capitalize on great deals. I can’t tell you the number of emails I get each week asking for advice, requesting the spreadsheets I created to do my analysis or running a potential deal by me to see if I think it’s any good.

Anyway, when we bought The Corn House, we had no idea what to look for, how to estimate rehab costs or how to properly analyze a deal. So, it’s not surprising that this project isn’t going to generate much profit for us ($4-6K at most); but it’s certainly nice that our very first investment will generate a profit, and more importantly, our buyers are getting a great house for the price.

I’ll have more to say about the deal — including financial details — as we approach closing and once I’ve done my final accounting on this property.

Btw, The Second Chance House is now formally under contract as well, and is scheduled to close the week of February 23…

3 responses to “House #1: Under Contract”

  1. Steph says:


    So what if you’re only making a few grand- look at all you’ve learned in the process. You can’t put a price tag on that.

  2. Nathan says:

    I think the most important thing is there is now confirmation that the houses are being rehabbed correctly (the quality, amount of work and the price point). Good feedback on the houses is nice but that doesn’t mean anything if buyers don’t want to purchase the homes. The true test is if the houses sell! I think that by getting these two houses under contract in a timely fashion proves that the business model is working and the work being put in is exactly on point.

  3. Seth says:

    Congrats on the recent successes, as far as getting stuff under contract. Getting anything under contract is an accomplishment these days, and any money you make (no matter how small) is just gravy on top, especially for the first project out of the gates.

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