New at Flipping Houses

[Chelsea Gatewood]

I've been watching dozens of videos and reading articles on how to flip houses.  From there I'm creating a google docs where I piece together all the points so I have a better understanding of how it all works.  The purpose of the google docs will be to share it with anyone looking for the comprehensive set of information of how to flip a house and for my own personal understanding.  

So far I've taken notes on defining your target market, what questions to answer about that area, the types of flips there are in 3 basic categories, financing options, how to farm for leads, renovations to consider, what type of contractor to look for, how to find them, and how to properly communicate with them.  

This google docs or "help guide" is far from complete.  I'm going to be editing it for at least the rest of this year before I shift my focus onto something else entirely. 

All that being said, what other steps are there in flipping a house that people might overlook?  Is there a standard of what certain renovations would cost or does it vary location to location?  Like is flooring typically  $"X" all the time or does it drastically fluctuate? In general, what else should I include in this guide?

My Location: Greensboro, NC. 

Note: My goal isn't to have a house flipping business.  I'm genuinely interested in the process and would like to help new investors as a real estate agent. I would consider doing a live and flip though!  

[David M.]

@Chelsea Gatewood

I'd suggest spending a few bucks for J. Scott's books, one on flipping and the other on estimating the costs.  Both are published by B.P.  Of the several that I have read, they are the most comprehensive and "fair minded" with no "upsell" or marketing talk.  You can finish your personal help guide from there, which will cover the "book knowledge..."

If you are trying to be a more informed agent, I think its relatively simple.  You make your money when you purchase --- because you can't sell for more than what the market will bear.  Meanwhile, you need to make the improvements that will "sell" the property.  Many flippers, myself included, go overboard in the reno.  But, that's why seasoned flippers give flip houses a bad reputation since they decide on the reno's aspects and quality on the necessity to make money.

A live in flip has much more potential, sort of...  Pre-covid, I saw many on-market properties that were good/decent fixer-uppers for owner-occupants.  An owner can fix it up at the cost to bring it up to market value.  So, as a flipper there would be no profit for me.  So, an owner could enjoy the property and in 2+ years sell it for the appreciation and take advantage of the sec121 exclusion.  Imagine having done that in 2018 timeframe and selling now!!!

Uhmm...  another catch-22...  if you can build/network a list of trades and vendors that could help.  As agents, we do that anyway.  My investment work has a bit of a "leg-up" since I've used these trades and vendors extensively so have a greater rapport than some other agents who just keep giving out referrals or maybe have used them once or twice on their own home.

I'd be happy to chat.  Send me a direct message if you are interested.