I finally sold the Fayetteville condo! I purchased the condo almost four years ago. It was going to be a fairly simple flip. It was assessed at $71,000, other units were under contract in the mid $50's and I purchased it for $25,000 and spent $5,000 on the rehab. Soon after putting the newly renovated condo on the market, I had an offer for $55,000. I was congratulating myself on such a saavy puchase and was dreaming of more easy profits on the next flip when the cold reality of post-housing crisis lending restrictions put a chill on my sale. My buyer could not get a loan guarantee from the Department of Housing and Urban Development (HUD). Some genius in Washington, DC though HUD was making risky loans and imposed a regulation that HUD would not guarantee loans in areas where the percentage of renters to owners exceeded a certain percentage. I determined this policy was racist because the impacted areas were overwhelmingly minority. The policy has now been overturned.
After the sale fell through I rented the condo with an option to buy. Fifty percent of the rent went to the purchase price which I set the low $50's. My tenants paid on time for the next 18 months but fell on hard times and had to be evicted. The eviction nullified the purchase option and I kept all the money. My next tenant was a party boy and the police were frequent visitors to the condo. I even got a call from the homeowners association with concerns about the late night parties. After only four months, I had to evict him. When I went down to clean up after the evicition, my neighbor came over and asked if my tenant was gone. When I said yes, she gave me a big smile and said, "Good! He had too many parties!"
After putting the place back in shape, I listed it for sale again. This time for $50,000 and some additional incentives. I offered one year of HOA fees and four percent to the buyer's agent. I also rented it again. In late February an investor made an offer that I accepted. We closed on March 20.
Hindsight has selective memory. Reflecting on the experience after the sale and check was cashed, I seem to remember the good things. Unfortunately, the entire ordeal was described in my book: "Where's MY Bailout?" Available on Amazon for the low price of only $2.99. After the four intensive days in the initial rehab, my back was killing me and I was totally spent. That was only temporary and worth the effort when rent checks started coming in. After the sale, it was completely worth the pain!
When I first bought the condo in the depths of the Great Recession, I immediately hired painters, floor installers, carpet installers and a plumber. I bought paint, flooring, carpet, mirrors, microwave, stove, and washing machine. After the first eviction, I hired more painters and bought more carpet. As the economy was falling apart, I sunk about $7,000 into the Fayetteville economy over four years - and this is just a tiny 1,000 square foot condo!
If the government and banks had sold more foreclosed properties in the early days of the recession, investors would have stimulated the economy into growth long ago. Sadly, the number of vacant and delining properties remains far to high.
After the sale fell through I rented the condo with an option to buy. Fifty percent of the rent went to the purchase price which I set the low $50's. My tenants paid on time for the next 18 months but fell on hard times and had to be evicted. The eviction nullified the purchase option and I kept all the money. My next tenant was a party boy and the police were frequent visitors to the condo. I even got a call from the homeowners association with concerns about the late night parties. After only four months, I had to evict him. When I went down to clean up after the evicition, my neighbor came over and asked if my tenant was gone. When I said yes, she gave me a big smile and said, "Good! He had too many parties!"
After putting the place back in shape, I listed it for sale again. This time for $50,000 and some additional incentives. I offered one year of HOA fees and four percent to the buyer's agent. I also rented it again. In late February an investor made an offer that I accepted. We closed on March 20.
Hindsight has selective memory. Reflecting on the experience after the sale and check was cashed, I seem to remember the good things. Unfortunately, the entire ordeal was described in my book: "Where's MY Bailout?" Available on Amazon for the low price of only $2.99. After the four intensive days in the initial rehab, my back was killing me and I was totally spent. That was only temporary and worth the effort when rent checks started coming in. After the sale, it was completely worth the pain!
When I first bought the condo in the depths of the Great Recession, I immediately hired painters, floor installers, carpet installers and a plumber. I bought paint, flooring, carpet, mirrors, microwave, stove, and washing machine. After the first eviction, I hired more painters and bought more carpet. As the economy was falling apart, I sunk about $7,000 into the Fayetteville economy over four years - and this is just a tiny 1,000 square foot condo!
If the government and banks had sold more foreclosed properties in the early days of the recession, investors would have stimulated the economy into growth long ago. Sadly, the number of vacant and delining properties remains far to high.