Click Fraud Protection

A New Flip Purchased (This Time in a 55+ Community)

Last week our team picked up another flip in the 55 and over community of Ridge, N.Y. known as Leisure Knoll.  This is not to be confused with the other 55+ communities in Ridge known as Leisure Glen and Leisure Village.  This crosses people up to say the least, but regardless Leisure Knoll is a quaint little area for those looking for a maintenance free lifestyle coupled with the benefits of owning a free standing home.

How Did This Transaction Unfold?

This house came into my possession pretty quickly as my broker, Jason Sorli (ReMax – Alliance), called me up one day to explain that this house was on the market as a contract vendee situation.  Basically someone had won the bid to purchase this home at auction, but then simply wanted to assign the bid to me for a fee.  They actually won the bid several months ago, but had spent quite a bit of time clearing title to the property.  I actually knew the title company very well, and I also knew the person there who was handling this file.  In addition to this, my broker was very familiar with the community as his father had owned a residence there up until when he passed away.  All I had to do was get my contractor over to see it to come up with a repair bid, and it was just a simple numbers crunch to know that this was a strong deal.  At a $150,000 purchase price, this was a no brainer. We were under contract in a day, and we closed two weeks later.  That’s quite fast for New York.


How Was I Able To Buy in a 55 and over Community?

Originally I avoided these types of deals because I was under the impression that I would have to partner with someone who was over the requisite age in order to satisfy the Homeowners Association.  I did a little due diligence and realized that being over 55 only applied for those who wanted to LIVE in the home, but ownership could be of any age.  That’s when I knew that I had to move on this quickly because these types of homes are in very high demand.  Even though the buyer pool is smaller, there is such a limited supply of these types of homes especially those that are in top condition.  Ultimately that would be the end product we would put on the market.


What Is the Scope of Work?

You may have heard me use the term before “Advanced Cosmetics.”   Well that applies to homes where basically you are redoing just about everything without gutting the place down to the studs.  That consists of roof, siding, windows, paint, trim, floors, kitchen and bathrooms.  You don’t have to redo any of the mechanicals, but you are giving the place a full face lift from top to bottom.  These are my favorite deals because if you handle them properly they can be done quickly and transform the property completely.   I estimate about $50,000 in work for the home and I hope to be done some time in early June.  It helps that the house is small (approximately 1000 square feet) which helps to lower the material cost and repair time.


What is My Anticipated Profit?

To understand my profit let’s go over the costs.  We already know the purchase price and rehab numbers.

Purchase Costs:

In this particular case, my costs to purchase the property were slightly above average. The title insurance policy and deed recording costs were at $1200.  I actually didn’t have to pay for a title search which saved me about $400.  I did however have to pay transfer taxes which is common when purchasing a distressed property.  I also had to pay back HOA dues and an HOA registration fee which added up in total to $1600 (including transfer taxes).  I usually allocate $2000 for closing costs when I’m buying a property without bank or hard money financing.  In this case my total costs purchase costs were $2800.  A little more than usual but nothing crazy.

Financing Costs:

I am paying a private lender 10% as I am borrowing $208,000 on this particular transaction.  This will cover just about everything for me including soft costs.  I anticipate being in this flip for 5 months so my financing costs will be $8666  ($208,000 x 10% for 5 months).

Holding Costs:

During this period I will have to pay 5 months worth of taxes at an annual rate of $7500 so the cost there will be $3125.  Since this is the summertime, heating the house won’t be an issue (thank goodness because it is electric heat).   I figure between electric and water I will be somewhere around $100 a month so in total that cost will be $500. Since it is in a community, the HOA will handle cutting the grass.  That’s not free of course as I will have to pay $280 in maintenance a month which will total about $1400.   Insurance will be around $600 for the same period of time.  Total costs:  $5625

Disposition Costs:

I anticipate a sale price of $270,000.  This means my 4% realtor commission will be $10,800, my transfer taxes ($4 for every thousand) will be $1080, and my seller disclosure fee will be $500 as the case always is.  Total cost will be $12,380.


Anticipated Profit:

$150,000 purchase price

$50,000 in repairs

$2800 in purchase costs

$8666 in financing costs

$5625 in holding costs

$12,380 in disposition costs

$270,000 sale price.

Total profit of $40,529.


Profit wise, this is pretty much where I like to be for any house I sell $300,000 and under so no complaints here.  In terms of ROI (Return on Investment) if you factor all of the money being laid out (minus the disposition costs since that is deducted at the sale) coupled with a 5 month holding time, you are looking at a return of 45%.  Pretty hard to get that in the stock market even when a stock is really hot.  We will see where were end up, but we are looking forward to revitalizing this house.  One thing we have noticed  is that we are a big hit with the neighbors who were tired of staring at such an eyesore.   That’s always one of the highlights of this business.  Thanks for following and we will keep you updated!!

Get More Info On Options To Sell Your Home...

Selling a property in today's market can be confusing. Connect with us or submit your info below and we'll help guide you through your options.

What Do You Have To Lose? Get Started Now...

We buy houses in ANY CONDITION in NY. There are no commissions or fees and no obligation whatsoever. Start below by giving us a bit of information about your property or call 631-825-8041...

This field is for validation purposes and should be left unchanged.

Like Us On Facebook

Our Reviews – People Love Us!

Easy to work with and very knowledgeable about the Long Island real estate market. Always a pleasure doing business with Jeremiah

Jeremiah is great to work with and a straight shooter. He won’t sugarcoat anything and is great to work with.

It is a pleasure working with Jeremiah. Always fast with responses and works tirelessly to get the job done. Highly recommend.

Bought a duplex as an investment and realized we were in over our heads so they took it off our hands. Glad to be out of it and I hope they do something nice with it. Very easy to work with and closing was fine.

Worked with Jeremiah mostly and he was awesome. Closing went better than I expected. There’s always problems at closing right?? Not here. All went well and glad I sold to them versus some of the others.

We are a real estate solutions and investment firm that specializes in helping homeowners get rid of burdensome houses fast. We are investors and problem solvers who can buy your house fast with a fair all cash offer.