How much per hour does the average fix and flipper make?

Question

Maybe you guys don't think like this... but when I do an appraisal I get paid a fee no matter how many hours I work; but, I keep track of my hours so I can calculate $/hr so I know what types of jobs I should focus my time on. If I make above $50/hr its a really good job and below $30/hr I am not too happy.

Have any of you ever calculated this for a fix and flip?

J Scott · Answer

If I considered the time I spent on BP as working time, my hourly would be about 10% of what it is!

James Vermillion · Answer

J Scott, that was a crappy reply. I also have not really attempted to come up with an hourly rate...that is not to say I only focus on J's #1, but it is more important to me right now than #2. As I continue to mature in my investing and become more efficient and able to delegate more tasks, I will do so. Do you count the time you take to calculate the time you spend into consideration? :)

Will Barnard · Answer

I have flipped many many homes and have never taken it down to an hourly rate. Here is the problem with that. - If you do get one flip where the profit was $500 per hour simply because you spent less time, but the net profit was say $20k, unless you can consistently replicate that every single work week hour, it does not matter. I have spent only 2 months (includes time from acquisition date to sold date) on a flip and made $35k, but have spent 6 months and made $220k. Which one was the higher per hour? Not sure, but I will take the $220k in 6 months every time even if the hourly rate was lower.

Sean Brennan · Answer

David Robertson Congrats on your improvement, that is really great. James Vermillion lol J Scott Yea, I've put alot of time on this site too over the past few weeks. But it must be great to enjoy your work so much that you can continue to talk about it for hours!

Justin S. · Answer

I agree with J Scott. When I first started out I would visit the properties quite often and make course corrections as necessary. Since then, I've hired a project manager who does that and I rarely (if ever) visit the properties. My main focus is now on creating competitive advantages, becoming more efficient, expanding to other states, and working on big pictures goals for my company. If I was "hired" to do something then I would put a value on my time, but when I work on my business I don't do that as my goal is to grow the business into something great.

J Scott · Answer

While I don't do the calculations, per se, the time/money tradeoff is always in the back of my head... Remember, there are two way to increase your hourly earn: 1. Make more money; 2. Work fewer hours. Most investors I know focus solely on #1 above. I'm a big proponent of focusing on #2 (please no poop jokes :). By creating processes to make your business more efficient, you should be able to make more money while at the same time working fewer hours (or if you want to work more hours, you'll make a LOT more money). When I first started in this business, I was spending 100 hours at the job site for each project. This was the absolute best use of my time, as it taught me what I needed to know to systematize much of the rehab work. Now I generally see the project once before we start, once during renovations and a couple times during the listing/selling phase. Not only does it free up my time to work ON the business, but my contractors tell me that things go more smoothly without me there... :) So, yes, hourly wage is a factor for me, but I like to focus on decreasing my time investment in order to increase that hourly wage. I can then use those extra hours to focus on other business opportunities or personal stuff.

David Robertson · Answer

I have only flipped 3 houses so far with varying hours dedicated to each... My first flip I ended up doing the interior painting, exterior painting, hardwood flooring and the kitchen tile backsplash and some miscellaneous punch list items. We only made $13k on that house and I split the profit w/ my partner...I probably spent 120 hours just doing manual labor + management of an extra 10 hrs a week during the rehab...so around 200 hours... $6500/200=$32.50 per hour....not bad, but not enough to quit the day job! My second flip has kind of been a nightmare, I have had 2 contractors walk out on me, but for the most part I have been only purchasing materials, dealing with the contractors....lets say 5-10 hours a week...I probably have 120 hours in that one and we stand to make $15,000...$7500/120=$62.50 per hour My 3rd flip I hired a contractor I can trust and that I don't have to baby sit...I really only go over to the house 3 times a week for about 30 minutes...I have had to make 4 runs to Lowes to buy bulk orders, but that has been about it...we should make around $25k on this house and I bet I will have 60 hours in management time...$12,500/60=$200 per hour...

Jon Klaus · Answer

You are partnering in the work with your money. You need to give your partner credit for its contribution, too. Hourly would be unusual, but doable I suppose.

William Bannister · Answer

I totally think like that. Im always trying to figure out what i make an hour on a job. A rehab I am not spending much time on and I sell it and make 35k and it was a job where I spent an hour a day in the house for 60 days then sold it. Fat bank there over 500 per hour. Other deals I actually rolled my sleeves up on and then made 30k and I had so many hours into the project I was lucky if i made 200 an hour. I was the person doing tile work laying carpets and install plumbing and doing some electrical work. A deal like that I might have 150 hours labor into it since I might have been doing some of the skilled labor myself to save a few bucks. I just think doing the labor cheapens yourself as an entrepreneur and I dont do much on my rehabs anymore. If you say managing the rehab I admit thats where my time is, in meeting people at the property then following up at the end of the day. So I would go in the morning and meet a few people at 9 am then cut out and come back at 3pm for follow up and walk through see what happened. I might only have an hour on the property. I have one income property I have been getting checks now for 12 years and do very little but check over a monthly cam statement. How does one do that? Would I say I worked one hour a month on statement and 15 minutes a week with manager and for that 2 hours monthly I get xxk per month? On income property its different if its smaller its a headache and requires management but larger projects often hands off just a check in the mail and a cam report to go through every month. I get calls once a week or so but thats because I insisted on it. Then in my orchard I literally make nothing there per hour because Im trimming and planting apple trees how much does a landscaper cost? 9 per hour? This is a labor of love a little different sort of like a guy that washes his own hot rod.