Our journey to home ownership is a little atypical. We purchased a home that needed "updating" because we wanted to minimize the overall financial risk that comes with simply flipping a home. (If you want to learn more about our journey to home ownership take a look here, here, and here). We wanted to find a home that was livable from the beginning. So, for instance, if I quickly discovered I just hated renovating, we still had a place to live without having to pay to make it livable.
The challenge: Update our home on a limited cash budget spending ONLY what is necessary to raise the value of the home SO that we can ensure we make a profit when it comes time to sell.
The plan is to fix up our home using DIY home reno and thrifty spending, and then sell it for profit once we are finished. This time frame could be a year, it could be 4 years, it could be 6 months. I still get overwhelmed, terrified, nervous and excited about this plan. We are all in now, there's no turning back. And there is always the looming question of even if we are successful in updating the home, will it sell for profit?
The challenge: Update our home on a limited cash budget spending ONLY what is necessary to raise the value of the home SO that we can ensure we make a profit when it comes time to sell.
This feels a little overwhelming at times. Like during the tile incident of 2013, we realized that we might NOT be able to do it ourselves. This is a scary thing when operating on a tight budget. If we can’t DIY it, how much does it cost to pay someone? How much does that take away from our overall profit? Will we have enough money to finish the rest of the kitchen?
After reading stories of flippers, stories of home renovation gurus, and stories of couples just like us, we came up with a plan I like to call the art of the slow flip.
We are 9 months into our home “updating” and so far, so good. I do like home renovation – phew! We have managed to overhaul an entire kitchen, learned to lay tile on the floor and a backsplash, painted the entire house inside and out, decorated the living room, dining room, and guest room, and are cooking up some mean plans for the bathrooms. We still don’t know if our home will sell for profit or if all our hard work will be for naught. I guess the answer to that question will remain a mystery to us for now, but in the meantime we do plan to continue updating this home through DIY projects, careful spending, and thrifty decorating.
"oh, so you are flipping a house."
Yes and No. The difference is...
1) We didn't want to be subject to the market's highs and lows when it came time to sell. We wanted to minimize risk by finding a place we could stay in long-term if necessary.
2) We are living in our project. Most flips take place outside of the flipper's home. Flippers generally live in their own home, and "flip" another house they have purchased, and then make a profit.
For us, this is not just another house we are flipping, but our home.
3) Sometimes flipper's will have two mortgages or a construction loan - one for their home, and one for the house to be flipped. We are do have a mortgage but all of our renovation work is paid for with cash.
Yes and No. The difference is...
1) We didn't want to be subject to the market's highs and lows when it came time to sell. We wanted to minimize risk by finding a place we could stay in long-term if necessary.
2) We are living in our project. Most flips take place outside of the flipper's home. Flippers generally live in their own home, and "flip" another house they have purchased, and then make a profit.
For us, this is not just another house we are flipping, but our home.
3) Sometimes flipper's will have two mortgages or a construction loan - one for their home, and one for the house to be flipped. We are do have a mortgage but all of our renovation work is paid for with cash.
Is your journey to home ownership/living debt free a little less than typical?
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