First live in flip?!

[Hayden Travis]

Hello my name is Hayden Travis and I am a young investor living in Amarillo, TX. I am currently in the process of finding a possible live in flip funded by a FHA streamline type loan. Most houses, on the MLS of that type, are valued so high that purchasing at such wouldn't lead into a profitable deal.

Is it more reasonable to find profit in the negotiation of the deals on the MLS? Or would it suit me better by taking a more creative approach by finding other deals off the market?

[Ronnie Galindo]

Hey @Hayden Travis! So in today's market, negotiating houses on the MLS is a very difficult feat. There are not a lot of houses and there are a lot of people buying. With the interest rates going up, that will weed out some buyers but then makes the numbers harder to make work. What I did was found a home that was stuck in the 80s (I'm talking pink sinks and paint everywhere) and bought that. I bought my house though 3 years ago so it was a different market before covid. I put a lot of work (my own time and energy) into the home and transformed it into what it is today. Now I am sitting on around $200k equity in 3 years. With that said, you'd have to live in it for 2 years (in the last 5) to escape capital gains so when you are running your numbers, are you looking at that projection? FHA (and VA, which I used) need to be in a stable state, meaning that the home has to be livable which makes it hard because there are other buyers out there doing what you are trying to do.

If you have the time and energy, definitely look off-market and see what you can stir up but in the end, time helps this process and REI is not a fast paced thing (unless you are a flipper or something of the sort). Be creative in the sense of finding a home that has that special something that people are over looking (space to put in an ADU, an unfinished basement that you can finish to rent, etc). Good luck. If you have questions, message me and I'd love to help further.