My experience with fix/flips

[Chintal Patel]

As a full-time and active real estate flipper I have gained some extremely valuable information that may be helpful for anyone just starting out. Just to give some context, I started flipping houses in my senior year of college at Rutgers University while I was studying Economics and Real Estate. It was a nontraditional route for sure because my friends were securing internships while I was out looking for ugly houses to carpet/paint for a profit. Since graduating I've flipped several houses and transacted millions in residential real estate. My company functions as a investment/consultation company giving everyday working professionals the opportunity to invest alongside a full-time experienced flipper. My company also offers custom construction services to clients for their personal homes. As I've navigated through these first few years I would like to share my experience, hopefully someone can get value from it: 

The Lesson: Flipping houses is technically not investing in real estate. Let me clarify; flipping houses is a buy/sell business just like any other inventory one could buy/sell. An example would be a retail store that sells hats, they source hats, buy hats, maybe brand those hats, and sell them for a profit. This a business model that is based on selling inventory for a profit. Yes, the opportunity to add value exists in flipping houses, but it does not change the fundamental activity which is that flipping houses is an active merchandise style business. A hat store buys and sells hats, we don't call it a hat investing business right? 

The Understanding: Now, there's absolutely nothing wrong with flipping houses if you have the right skillset like patience, ability to manage several things at once, attention to detail, and an understanding of the micro-market. It is a difficult task but pays well. This may be a great starting place for someone who is looking to leave a dreaded job in pursuit of something better. But, just understand that there is very little "building" involved in flipping houses. 

The Next Step: Now, if you want to build wealth, enjoy a life of financial freedom and let your money work for you. The way to do that is through investing in real estate by buying an asset, having it pay you monthly (while paying the debt down), and having it appreciate over time to compound your wealth. As I learn this lesson, I want the reader to understand that it is your choice how you want to make money, I felt like it was my responsibility to convey this message as best as I could to help you avoid mistakes that I made. My company will re-strategize it's business plan to include purchasing assets that produce cashflow and build wealth. I really enjoy flipping and building high quality housing, to design construction and manage the projects we tackle. I will continue to do the things that align with my purpose, but I have a newfound respect and understanding for the fundamentals of investing now. 

Thank you for reading. 

Best,

Chintal Patel