As a real estate investor, turning a profit on a flip is how you make your living. It’s how you put food on the table and grow your business. A profitable flip supports your business and personal life. This post will discuss the top five factors that prevent both novice and experienced house flippers from turning a profit on a flip. If you take these problems and apply the solutions to your business, there’s no reason why you can’t make a bigger profit on a flip! Problem 1: You don’t have a realistic budget Accurately analyzing repairs is a skill that always gets better with time and experience. After a few flips, you start to understand more of what to look for and extras to account for. Not all investors have time or experience. If you have just jumped into the real estate investor game or you only do a couple of flips a year, you may have problems accurately calculating the cost of repairs. You may be able to turn a profit on a flip, but maybe you feel like you could be making more. What can you do? Calculating repairs isn’t an exact science, but you can definitely get close! Try using my Budget Cheat Sheet. It is used for calculating general costs of material and labor. It also includes 10% of “fiscal wiggle room” to ensure that you can account for the unknown. Again, this does not calculate repairs down to the penny, but it will put you in an accurate ball park and should be included in your real estate investor tool box! You could also walk rehabs with a contractor. It never hurts to ask for help, especially if you have built a great relationship with your contractors. Without somebody like a mentor or a tool like a budget cheat sheet, you will have a hard time knowing what to look for and how much it will cost to fix. Walking a potential flip with a contractor can help build a great relationship with them, as well as increase your understanding of what general repair costs are. Try using a budget calculator to determine repair costs Walk potential deals with a contractor When it comes to budgeting, always account for the unexpected Problem 2: Over and under improving More often than not, rehabs end up under repaired. Chances are if you have done the deal and are looking to begin repairs on the house, then you have calculated your ARV. You know how much your house should sell for, but do you know why it should sell for that much? If you based your ARV on houses that had granite counter tops, then your rehab needs granite counter tops. Your house needs “wow” factors. If you under improve your house, there is no way you will to...
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In this video, Andrew shows you how to flip a house by executing the perfect system. For demolition, design and display in many different areas of the physical property. Andrew has spent the last decade showing investors of every experience level how to flip houses. Now you too can learn how to flip a house! Today you can expect to learn: How flower boxes can influence the look and feel of a home. Want to learn more about how to flip a house? Click here to view part three of the series. ...
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As a new real estate investor, nothing is more nerve racking than buying your first property. It’s taking that first big step down a new and exciting career path. I can tell you that once you get your first deal, you’ll only want to get more. However, before getting that deal, there are three major things to consider. These three factors are a very important part of planning what exactly you are going to do after buying your first property, and require careful consideration. 1. What is your end goal? Having a plan and goals are as important when buying your first property as it is for every property after that. However, the process when buying your first property sets the bar for all the ones that come after. Ask yourself “what do I want to accomplish“. Is there a certain amount of profit you want to make? Is there a specific date that you want your repairs to be done by? Maybe you just want everything to go smooth. Don’t worry about what the “latest and greatest” method or strategy is. Do your homework and figure out what goals fit your business model. Whatever goal you set now will help you how to deal with similar situations in the future. Without having any kind of end goal, you can’t put together the steps to achieve one. Creating an end goal lays the foundation for everything that comes after, like creating a strategy and putting your team together. Set an end goal Don’t worry about the latest and greatest Use your goal to develop steps to achieve that goal “Success is where preparation and opportunity meet.” -Bobby Unser Click To Tweet 2. Know your exit strategy! Before buying your first property, you need to have a goal in mind for the property. Before you make the offer, you need to set an expectation. Know your exit strategy! What do I mean by exit strategy? If you are going to take the time to repair the house and sell it after, your exit strategy is to flip and sell the house. If you are going to turn a quick profit on the house then don’t plan on any repairs, plan on wholesaling. Flipping and wholesaling would be your exit strategies. Both require different pricing and planning, but both are examples of exit strategies. In addition to a main strategy you’ll want a “ripcord” strategy. You’re buying your first property! It’s worth having an extra strategy. If your main strategy is to flip a house and sell it, and your house doesn’t sell, consider selling it at a deep discount your emergency strategy. Let’s say you want to fix your new property and rent it. Your “ripcord” strategy should be to sell it and move on to the next deal. Limit yourself to only two strategies and...
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In this video, Andrew shows you how to flip a house by executing the perfect system. For demolition, design and display in many different areas of the physical property. Andrew has spent the last decade showing investors of every experience level how to flip houses. Now you too can learn how to flip a house! Today you can expect to learn: How colors can dictate the atmosphere inside of your property Want to learn more about how to flip a house? Click here to view last week’s lesson! ...
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