Anyone making $100/hour doing RE investing?

Question

Let me explain in more detail.

For Buy and Hold investors, does anyone make >$100 of cash flow per hour worked doing RE, this includes searching for deals, leads, paperwork, tenant screening and selection, talking to agents, soliciting repairs, screening contractors/electricians, PM, phone calls, escrow. etc.

Same question for flippers, lets say you average $30,000 profit on flips and each takes 4 months, including every single hour you spend on RE and that deal, do you spend less than 300 hours total on that deal?

Would love feedback from intermediate and experienced investors.

Leigh C · Answer

Flipping=sprinting,    B/H=walking.  You can walk for a long long time before you get tired, sprinting has it's limits.   I remember a story about a turtle and a rabbit as a kid....

Account Closed · Answer

I actually tracked and calculated this on my last flip and it came out to $234 per hour on a $31,000 Net

J Scott · Answer

Historically, Atlanta...though that market has gotten tougher over the past two years...

Account Closed · Answer

Andrey, I try to stick with the basic formula (After Repair Value - Estimated Repair Costs) x .7  to give me some buffer; however, the market is tough right now - in my area - and it is difficult to find deals like that, but after about 20 hours or work I just got another one under contract.  I also hire and fire and manage my subs rather than uisng a PM or contractor, which is why I have so many hours into it. If I could find a good project manager I would use one and I plan to eventually. I buy and hold but only mutli-family to get some ecnomies of scale with upkeep and management. I use the profits from SF flips towards my multi-family purchases.

Chase Gochnauer · Answer

I wouldn't think of an hourly rate of the first couple years of your B&H being a reliable metric. That to me is the point of the B&H, is that you don't make all of your cash initially. In order to calculate your hourly rate on the B&H, you'd really have to wait until you sold that property, whether it be 1 year or 10 years later. Only then would you be able to have a reliable hourly rate. Over a 30 year period, you'd have 30 years of appreciation along with zero mortgage, and increased rents. If you averaged $500/mo cash flow over 30 years($180k), and lets assume initial purchase was $150k, and now it's worth $300k. That means you've gained $480k in equity/cash flow over 30 years. If you spent 3 hrs/mo on that property, then that equvilates to $444/hr. Pretty damn good.

Andrey Y. · Answer

Thanks J, puts things into perspective. Which area of the US would you say your flips gave you best value for your time/money?

J Scott · Answer

But, just like poker, you should know what your hourly rate is over the long-term.  Any professional poker player should be able to tell you their hourly along with their standard deviation, so that they know an income range over any particular number of hours.  Likewise with any established investor or business owner.

Matthew Paul · Answer

I look at it like playing poker , never count your chips at the table .

J Scott · Answer

These days, I'm somewhere between $200-250/hour in my flip business.  The hourly has dropped since I moved to Maryland and don't have a project manager for my local flips.  Note that I'm far from full-time these days as well...

This assumes I don't count my BiggerPockets and blog writing time as part of my flipping business...if you count those, I'm probably closer to minimum wage...  :-)

Kenneth LaVoie · Answer

I'm guessing my wife and I do. We have a stabilized 48 units, and  I BELIEVE our cash flow (higher since we self manage) divided by the number of hours we put in > $100. I'll have to do a "back o' the envelope" on that one.

Anyone making >$100/hour doing RE investing?

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