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In the beginning, Colin Egglesfield, 44, and Tyler Neitzel, 25, had simple goals: They wanted to make some money and make a difference. Flipping houses in an underserved neighborhood seemed like a good idea. Their search led the two Southern California–based actors farther afield than they’d expected—to Chicago’s South Side, where the headlines are more likely to be about violence and poverty than entrepreneurship.
Initially, the pair had planned to flip homes in California. But the pricey landscape proved prohibitive.
“California is very competitive, where a single-family home is about $500,000,” says Egglesfield, who’s had recurring roles on “Melrose Place” and “All My Children.”
Egglesfield, who spent part of his childhood in a southern suburb of Chicago and was familiar with the South Side, had an idea to return to his roots to realize his flipping vision.
“In Chicago, you can pick these properties up for $30,000 or $50,000,” he says. On the South Side—which encompasses depressed neighborhoods as well as the tonier Hyde Park, home of the University of Chicago and former President Barack Obama‘s family, pre-White House—asking prices were generally low and competition was almost nonexistent.
During a trip home for Thanksgiving last year, Egglesfield toured properties with a listing agent.
“I was surprised how one block would look fine … and one or two blocks over you’d see boarded-up houses, like a ghost town,” says Egglesfield. Soon after, he purchased a Section 8 four-unit apartment building on the South Side.
Next, he and Neitzel—a San Diego native who has appeared on TV shows, including “ER,” “Crossing Jordan,” and “Brothers & Sisters,” as well as commercials—dove in and launched their property rehab business.
They brushed up on the basics but also sought advice from experts. A chance meeting for Egglesfield with Michael Corbett, who wrote “Find It, Fix It, Flip It! Make Millions in Real Estate—One House at a Time,” yielded invigorating advice. Neitzel sought out his uncle, a real estate investor, for additional counsel.
Egglesfield and Neitzel began making purchases. They’ve completed two projects so far, both of which are up for sale.
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A five-bedroom, two-bath brick bungalow is on the market for $169,000. The duo purchased the place for $60,000 in May 2016. From the listing photos, the finished product looks brand-new, with new carpeting, new hardwood floors, and bright, open spaces.
Another bungalow they finished, with the same number of bedrooms and baths, is also listed for $169,000. The investors picked up the place for $51,000 in September 2016. Built in 1914, the house is now camera-ready.
Two more properties are being rehabbed, and another one is going through the lending process. Neitzel and Egglesfield visit Chicago every six weeks to keep tabs on their projects.
As for the difference-making part of their entrepreneurial project, the duo’s on-site project manager, who knows the community well, hires ex-convicts, former gang members, and military vets, to “not just give them a job but provide for them an opportunity for a career,” says Egglesfield.
A recent report by the Great Cities Institute at the University of Illinois at Chicago found that unemployment among African-American men aged 20 to 24 hit 60% in 2015. The South Side is heavily African-American.
So it’s a big deal, Neitzel says, for the guys hired to do the rehab work, which includes tiling and carpentry, to be able to see their project manager as a role model.
And who’s buying these homes? They’re mostly dual-income families with three kids or less, says Egglesfield.
“They’re trying to get out of some of the worst neighborhoods of Chicago. It’s an opportunity to stop renting and become a homeowner and build the American dream. They can get into these homes for as little as $1,000 down.”
Mortgage payments typically run between $550 and $700 a month, he adds, making these homes affordable for families.
“We have a long-term vision,” says Egglesfield, “of not just going in there and flipping houses and making money. My goal would be to go in and build community centers.”
The post Chicago’s South Side Offers Surprising Opportunity for Flipping Duo appeared first on Real Estate News & Advice | realtor.com®.
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