By: Stephen Cook
It always amazes me when I talk to beginning investors
about the homes that they are looking at and calling
fixer uppers. They frequently tell me stories of homes
that they feel need to be torn down, and when I see
them I think they are in good shape, at least as far
as a rehab is concerned.
But then I think back to when I first started in this
business. I consider the homes that I had been looking
at and the difficulty I had in overcoming my first investor
In my early days as an investor I pursued homes that
today I wouldn’t waste a minute of my time looking at.
I was one of those people who believed that this couldn’t
work where I lived, and if I would have kept on the
same path that I started on, another casualty would
have been listed in the book of failed real estate newbies.
I used to think that homes that had dirty carpeting,
needed some painting, and perhaps they had a water stain
on the ceiling were fixer uppers. Today I consider those
homes to be in move in condition, people are probably
living in them now.
The first home that I ever did buy as an investor was
one that my initial instinct was to bring in the bulldozer.
I bought the home for $38k, and I totally fixed it up
for $7k and sold it for $64,900. $7k can go a long way.
The home looked pretty good from the outside, thank
God. If the outside would have looked like the inside
I probably would have walked away from my first deal.
When I got inside of the home I was totally bummed out.
My heart sunk, I felt nauseated and sick from the site
and smell, and the heebie-jeebies that I felt brought
on this overwhelming need to take a shower- and I don’t
mean in the home that I was buying.
The second we opened the door, the smell of cat urine
about knocked me over. I have asthma and this house
kicked it in. The carpet was torn up from the floors,
the walls were painted all different colors. I put my
shirt over my mouth and nose and began to venture inside
with caution. I gingerly walked across the floor expecting
it to cave in. As I got near the kitchen the first thing
that I noticed was the bright orange and green paint
on the walls. I was disgusted by the remains of dead
roaches, the cabinet doors missing, broke, and hanging
off. I couldn’t tell you what color the floor was supposed
to be, and I never did find out.
By this time I felt a little more comfortable that
the floors weren’t going to cave in beneath me so I
ventured toward the stairs. As I climbed the stairs,
I decided to test them first by pushing down a little
before allowing my entire weight to be supported by
the step itself. I walked up to the second floor and
into one of the bedrooms. It was painted electric blue,
had holes punched and kicked in, graffiti on all surfaces,
the closet doors were on the floor, and the door was
hanging from one hinge. I was no longer surprised by
what I was seeing. I then walked across the hall to
The bathroom was no prize either. The floor in here
was dangerous. Next to the tub it was really soft and
rotted through. I had to be careful. This room was absolutely
filthy, the sink was stopped up with something that
appeared to have been gooey, but dried out. The toilet
was no better. I wouldn’t even pick up the toilet seat
to see what was inside. The tub was rusted, had stick
on flowers, and the tiles were falling off the wall.
I figured that a stick of dynamite and $10k would do
the trick to bring this bathroom back to life.
Then we entered the other bedroom. This didn’t have
any damaged walls, but there was writing on the walls
and on the door. They tried to cover the writing up
with a red and white paint mixture, they didn’t do a
good job of mixing it so it looked really bad.
I only had one more place to check out, and it was
the basement. I immediately began to feel like I was
walking into a dungeon, and was glad that there was
a realtor with me, otherwise I doubt that I would have
went down there by myself. When we got to the bottom
and turned a light on, surprisingly this was the best
thing the home had to offer. It was by far the cleanest
room. It just needed some cobwebs cleaned up. But there
was a new furnace in the basement, so I finally saw
a positive about this house.
I walked out of the home feeling like I wasted my time.
I couldn’t believe that someone would even try to sell
such a home. I almost felt as though it should be illegal.
I wasn’t going to pursue the home until a friend of
mine told me that he was going to buy it if I didn’t.
So just to keep him from buying it, I did. I was scared,
I couldn’t believe what I had just done.
I talked to one investor about the home and he was
willing to give me $40,000 for it. I was shocked. I
had a $2,000 profit before my eyes just from one conversation.
But my friend made me keep this one to renovate. In
the end, I put in a new kitchen, carpeting, paint, fixed
the rotted floor in the bathroom, put down new vinyl
tiles in the bathroom and kitchen, had the tub refinished,
put a new vanity and light in the bathroom and completed
the renovation for just under $7k. The place looked
and smelled new, and my initial take was to tear it
These days I walk into houses that are much worse than
that one, and I see beauty in them. I’m about immune
to the smell, if nothing else I think I’m enjoying the
smell because it means CHEAP! When you see a home that
totally disgusts you, that is a good thing, because
it means that most other people are disgusted by it
as well and just aren’t interested in it.
About the Author: Steve Cook
Since 1998 Steve Cook has flipped hundreds of
houses as an active Baltimore-area real estate
investor. Steve’s unique specialty is the “flipping
homes 1-2 punch”, a proven system of real estate
investing that powerfully combines wholesaling
houses. Also the founder of www.FlippingHomes.com,
Steve is dedicated to helping others in this thriving
online community succeed through understanding
and aggressively applying his time-tested, step-by-step
approach to flipping
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