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Updated about 12 years ago,
Reality Check Needed – Going Full Time
Background: Recently my employer has decided to relocate our facility out of state and due to commitments in the Rochester, NY area I will not be moving. I am getting a generous severance package and have been saving a capital to begin investing (~1-2 flips worth) to begin my real estate investing. My wife also has a stable job to provide income for our family. In the past I have completed one flip(profit $24k) and managed a number of SFHs.
My Decision: I am seriously considering jumping into flipping full time with the goal to complete four flips in 2013($10k profit average assumed), and 7 in 2014 which would cover our living expenses in addition to my severance, and then grow from there with the goal to also begin investing in multi-unit properties for long term growth. I would also get my agent’s license to maximize profit and ability to write my own offers, etc.
Advantages: I can accelerate my network and team building significantly if I am focused full time. Good potential for long term income growth as I build my systems. Ability to do something I am passionate about. Control over my destiny compared to a 9-5 job. Respect within the real estate community which should help accelerate my Buy and Hold portfolio which is my ultimate goal.
Disadvantages: Potential for low inventory impacting ability to meet goals in 2013 and beyond. Risk of lack of capital (I have one private lender available to support 1 house in addition to my capital) drying up impacting ability to perform multiple flips at a time to scale the business. If I don’t succeed I can’t ensure what the job market will be when I need the income in 2014.
Obviously I would like to have more experience under my belt before starting full time and have a more established network to feed me deals but my main thought is that if I don’t take this opportunity now when I don’t need significant income in the first year to jump in I may never do it. Also by committing to the effort full time I will be laser focused on making it succeed, and ready to jump on deals (on which the numbers work) without hesitation due to any work commitments, etc.
What other pros/cons should I be considering? Does it seem possible to jump in full time with limited experience and succeed?