Have you ever "flipped" a house? Was it all worth it?

Question

My friends and I have been talking about putting together a team here in California. One of us is a real estate agent, another is in carpenter and another is going to school to be a General Contractor. There are 3 couples involved.
We just want to know your epxeriences and if it worked for you and "who" did you need?

Answer 1

I bought a house two houses in the city , I just rented them out until the housing market boomed the first house I paid 35 k for it and the second I paid 59 k I rented them for 15 years until the market sent the prices sky high I did all my work myself I sold both 3 years ago because the city property became prime real estate the first went for 140k minus around 8 k for remodeling after renters , the second went for 475k but i spend 20k on it , of course the housing market is steadily slowing down I have all the money in the bank (savings) I have thought of "flipping" houses but when you buy ,you never know what you are getting in to until you start tearing out , plus they are very edgy now about things like mold...lead paint on older houses , and old asbestos siding, plus you could easily obtain a former meth lab so you could be looking at up to and over 10k for clean up not counting the work needed to re sale a home then with the market slowing it could be awhile before you sale it is risky . plus most modern carpenters use low grade materials making the house look cheap plus a do it yourself painter can not do a professional finish , the cheaper the work looks the less return for you .good luck , after I fully analyzed all the In's and outs I decided not to risk it , and keep my money to retire before I turn 50 ..too much headaches ,that are not shown on the tv show

Answer 2

It is true that the money is made when you buy the house, not when you sell it. By that, I mean it takes work to find the truly good deal. Being a real estate agent can be a help, but not necessarily. You need to open up your mind.

I have realtors who come to me all the time who think $20,000 - $30,000 is a good profit. It really isn't. Especially when you are talking about rehabbing, because you just never know what you are going to come up and / or uncover. Invariably, there is going to be something that you either didn't aniticipate, but more importantly, didn't budget for that can eat up $20,000.

The 3 couples thing also scares me to death. How are decisions going to be made? How is money going to be let out on a project? Those types of questions with 3 people is tough, with 3 couples, you have your work cut out for you.

In conjunction with the 3 couples are their attitudes about money and realistic expectations about the project. Have you figured in the monthly holding expenses and the marketing expense (combined I usually figure between 8-12 percent)

What are your goals for this project? Are they to make a living? $20,000 divided by 3 isn't bad if it takes 30 days from start to finish. But in reality, that is not likely. I have houses that I do the basics of paint, light touchup and carpet that can take 30 days. That doesn't even take into time that at a minimum it will take 4-8 weeks to sell/close on the property.

That being said, this can be a lucrative deal. But it isn't as easy as the tv shows make it out to be.

Keep in mind that some of the best money you will make is when you do nothing to the home and wholesale it/assign it before you have to close on it. I have had several homes that because my plate was full flipped the contract to other investors for $5,000 - $10,000 within a week of getting it under contract without ever lifting a hammer.

Hope that helps.

Answer 3

Yes i have flipped many, and yes they were all worth it. I hope that the RE agent you have knows what to look for in a flip. Anyway, i would say do it with the least amount of people you can. Your proceeds reduce very quickly when you are splitting the pot 4-5-6 ways.
I used to do them with a couple others but now i do them on my own. i just hire a general contractor, much cheaper than splitting the profit with him. And so on.
Good luck,
RE Agent, Flipper
Remax

Answer 4

Did you know that Dolly the cloned sheep had the cells of a 4 year old when she was only 2? My point is; cloning works but it isn't perfected so NO I would not want a cloned puppy. The cost would also be a huge reason for me saying NO way and there are plenty of dogs out there already who need good homes.

Answer 5

First it depends on how much you know about value, costing and marketing.

You need to find a home under that market that needs work. When you purchase it you need to have made a profit up front.
You need to be able to spot a home that needs work and be able to see how much work it needs.. You need to be able to design the reservation so others will also like it and sell a home that is competitive with the rest of the market that has appeal to someone.

I have good vision, good skills and a good knowledge of the market so when I purchased, renovated and resold I made money. Not everyone does well at this and especially without the skills above.

Answer 6

I've seen people do it and make money at it. I've also seen some of those houses cost way more to repair than they had estimated and they lost money.

Answer 7

Yes........No