Rehabbing: Do you play Jeterball or swing for the fence everytime?

[David Robertson]

What is your business plan? Do you hit consistent singles or do go for the home run every time? What do you compare your business plan to a Derek Jeter (consistent $10-20k rehabs) or are you more of a Prince Fielder hitter that swings for the fences ($30-40k+ rehabs)?

The reason I ask is that I have had trouble finding and closing on properties that have more than $15,000-20,000 profit in the house. Do you pass on the singles and only swing for the fence?

I'm sure it depends on the market, business goals, etc, but any input is appreciated.

Thanks.

[J Scott]

I tend to be very conservative and shoot for a minimum of $15K or 15% of resale price (whichever is greater) in profit on each rehab. Over my past 25 retail sales, I've averaged nearly $25K in profit, so being conservative is working.

I've hit $40K+ profit on two projects ($145K and $165K resales), I've hit $30-40K profit on 6 projects (resales from $95-175K), and have only come in less than $15K on two projects (my very first flip was one of them).

So, I really like the methodology of shooting for "singles" but being conservative enough that they often turn into doubles and triples (and maybe an occasional home-run, depending on how you define it).