A Des Moines flip is usually a pre-war house with good bones and dated everything else. The margin is made or lost on three things: buying right, keeping the crew moving through an Iowa winter, and pricing the finished house to the right block.
In short: LendingStreet funds Des Moines fix and flip projects on 1-8 unit investment properties from $150,000 to $5M+. Some programs cover up to 90% of cost and up to 100% of the rehab budget, with closings in as little as 10 days. Loans are short term and interest-only, and the exit is a sale or a refinance into a DSCR rental loan.
The typical project is a 1910s to 1950s house in Beaverdale, Highland Park, Oak Park, the Drake area or the south side: one-and-a-half story bungalows, brick Tudors and small ranches. Kitchens, baths, flooring, paint, and often electrical and plumbing upgrades make up most budgets.
Buyers at the finished price are often first-time buyers or move-up families who also look at newer homes in Ankeny, Johnston and Altoona. A flip in the city has to compete on finish quality and on the things inspectors find, such as basement water and old wiring.
Duplexes near Drake that were split decades ago are another common project. Some investors restore them as single-family homes; others update both units and sell to an investor. Confirm whether the second unit is legal before choosing the exit.
We look at the purchase price, the rehab budget and the after-repair value. On some programs the loan covers up to 90% of total cost and up to 100% of the rehab. Rehab money is held back and released in draws as work is completed and inspected.
Because many Des Moines houses are inexpensive, small projects can fall under our $150,000 minimum loan size. Larger rehabs, duplex conversions back to legal use, and investors buying two or three houses at once fit the program best.
Your experience matters too. Investors with a record of completed flips may see higher leverage and simpler draw terms than first-time flippers.
| Piece of the loan | How it works |
|---|---|
| Purchase | Funded at closing, as a share of the price |
| Rehab | Held back, released in draws after inspection |
| Interest | Interest-only, usually on the amount drawn |
| Term | Short term, sized to the project |
| Exit | Sale, or refinance into a DSCR loan |
This example is illustrative and not a quote. An investor buys a Highland Park house for $140,000 with a $55,000 rehab budget, for a total cost of $195,000. The after-repair value is estimated at $255,000.
The loan covers 85% of the price plus the full rehab, or $174,000, about 89% of total cost. If fully drawn, the estimated interest-only payment is about $1,450 a month. Over a 6-month hold with taxes and insurance, carrying costs total about $10,740.
After about $17,850 in selling costs and roughly $407 in Iowa transfer tax, the estimated profit is about $26,503. Cash in the deal, including closing costs and carry, is about $36,240.
| Line | Amount |
|---|---|
| Purchase price | $140,000 |
| Rehab budget | $55,000 |
| Loan amount | $174,000 |
| Carrying costs, 6 months | $10,740 |
| Selling costs and transfer tax | $18,257 |
| Estimated profit | $26,503 |
Structural changes, electrical, plumbing and mechanical work need permits from the city's permit and development office. Cosmetic work usually does not. If you are moving walls, adding a bathroom or replacing a furnace, pull the permit; buyer inspectors and appraisers look for it.
Houses in Sherman Hill and other local historic districts have design review for exterior changes such as windows, siding and porches. Budget extra time for approval and for materials that meet the guidelines.
Roofing, siding, concrete and exterior paint slow down or stop in the coldest months. Interior work can move ahead, but heat has to stay on in a vacant house to protect the plumbing. A frozen pipe in January can turn a cosmetic rehab into a drywall and flooring job.
Many local flippers buy in late summer and fall, finish exterior work before the first hard freeze, and list in spring when buyer traffic picks up. Build the season into your draw schedule and your holding period.
Interior trades can also be easier to book in winter, when outdoor contractors look for indoor work, which can help keep your schedule tight.
At closing, Iowa charges a real estate transfer tax of $0.80 per $500 of the price above $500, usually paid by the seller. On a flip, that is you. Iowa also handles title through abstracts and attorney title opinions rather than standard private title policies, so factor in abstract updating costs and time.
Expect buyer inspections to focus on the basement, the sewer line, the roof and the electrical panel. Fixing those up front tends to protect your price better than adding high-end finishes.
Sometimes the best exit is to keep the house. If the finished home rents well, you can refinance the flip loan into a DSCR loan that qualifies on the rent. Before you lease it, the City of Des Moines rental certificate has to be in place, and the house has to pass the inspection. Our Des Moines rate-and-term refinance page walks through that exit.
A clear file gets a faster answer. Send these through the form below or call (877) 298-1001.
Some programs fund up to 90% of total cost and up to 100% of the rehab budget. The exact amount depends on the project, the after-repair value and your experience.
In as little as 10 days once the file and title work are complete. Iowa abstract updates can add time, so order them early.
Yes, $150,000. Small cosmetic flips on low-priced Des Moines homes can fall below that, while larger rehabs and multi-house purchases fit well.
Rehab money is held back and released in draws after each stage of work is inspected. Plan your contractor payments around the draw schedule.
For structural, electrical, plumbing and mechanical work, yes. Cosmetic work generally does not need one. Unpermitted work can create problems with buyers and appraisers.
Usually the seller, which on a flip is you. It is $0.80 per $500 of the price above $500.
Yes. You can refinance into a DSCR loan once the house is leased. In the city, get the rental certificate in place first.
Yes. Fix and flip loans cover 1-8 unit investment properties, including the duplexes common near Drake and Sherman Hill.
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