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Anyone ever flipped a home? I am absolutely hooked on that show on TLC. I dream of finding a house and then making a small boatload of money. I think it takes a knowledge of the market and moreso the neighborhood to know how much to sink into a home. Maybe one day I can find the right home and situation to do so.
Well the guy that bought my old house did it.......
The house I sold in Boston, the guy that bought it tried that flipping crap. Told me a bunch of lies about why he was buying it, I really didn't care. He had to get me a quick "AS IS" deal. I did not really have to explain much and there where no inspections. You were looking at ~$100K to make it right if hiring it out. I guess he figured, him and his buddies could do it on the cheap.
I know what he paid me, know what it resold for. Have a pretty good idea of what he had to do. Doubt he made any fortune. On paper there could have been a $53K profit but in real life, I bet he was lucky to make even $10K net. Right at the end, before I left, he started to seem a bit hassled, the estimates were probably a lot more than he figured. He had to carry it for six months and I also saw all the additional lies he had to tell to dump it. The final sucker should at some point figure out what happened. That is what they make lawyers for.
That puppy was right at the point of needing a complete new roof, my work up showed 134 items on the work list, 34 of them were serious.
They always make it sound like the original seller got screwed. Well not really, I got a super deal, it was more about time, so much was required, it was more about greed and cycling dollars. That and finding a new sucker. I'm sure he did not get an "AS IS" deal on his sale and could be on the hook for everything that got hidden from the final sucker. As typical the real estate taxes went wild as they got permits for some of the work. Up, like over 300%.
The real estate laws need to be changed to disclose that a house has been bought and "Flipped". Any buyer should realize it but it should have to be disclosed that the house was never in a normal buy / sell progression. Many homes get much needed work but many are also jacked up in price that traps an unwary sucker with many items that should have been done.
Those shows show approximate GROSS profit not real NET profit. If the cost of the money used, the owner time and labor, and cost of sales transactions are factored in you will find it is not very lucrative in many cases.
They have finally started showing on some of the shows a recap at the end to give an update. Most of the time it seems the flipper had to sit on the house longer than they would have liked and they had to drop the price down.
Never "flipped" a house but thought of it. Problem is the houses that would sell when all "dolled up" are in areas that even not up to date are selling pretty high. That or they sit on the market because the original owner thinks their house is worth just as much even though it has no updates. I've been thru a few flipped houses and can usually tell. One had to rent it out and now it is back on the market. Another has "for lease" on their sign now as they have not sold it. I know why. They went thru and just put in some cheap carpet and painted but left all of the outdated faucets, light fixtures, etc. Change those out too. Geez, if they would have done that it would have sold. In the end when a renter moves out they are going to spend more money replacing the carpet and painting AGAIN than it would have cost to REALLY finish the house out in the first place.
I think maybe you could do it by restoring (and I mean in the right way) a historic house in an up-and-coming area or just finding some place which just needs new paint and carpet but the seller was too lazy to do it..
Otherwise I don't think it's going to work in this market.
I flip a few homes a year and have netted between $12,000 and more than $100,000 on each. You have to know the market pretty well and try and find where the 'hot' places are going to be. So far, we have been very fortunate to find them. We also don't try to rip people off, we like to make a profit and also have a great house to sell that someone is moving into with a little equity left for them. We are friendly with every person we have sold to after 10 years of doing it.
Interesting. So are you a realtor also? Just wondering how you know the market so well.
No. My husband was a realtor for a few years almost 20 years ago, but we simply love houses. We live and breathe looking at homes, pricing them, fixing them up, making strategies to sell them, everything. This is what we love to do.
I flip a few homes a year and have netted between $12,000 and more than $100,000 on each. You have to know the market pretty well and try and find where the 'hot' places are going to be. So far, we have been very fortunate to find them. We also don't try to rip people off, we like to make a profit and also have a great house to sell that someone is moving into with a little equity left for them. We are friendly with every person we have sold to after 10 years of doing it.
When you say 'net' does that include a salary for you?
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Well the guy that bought my old house did it.......
