Planning on doing our first fix and flip! Advice?

Question

Me and my partner are wholesaling but recently found out we have connections to a good supply of liquid funds. We thought we’d take our business and use wholesaling to get us funds to do our first flip. However I had the idea of doing the flips ourselves as opposed to giving away big profit since we have access to the money to do so! I feel as though if we entertained the idea of flipping ourselves, it would fast forward our process of building our business. Please give me your thoughts/advice

Thank you in advance!

Jonathan Greene · Answer

Your flip will take twice as long as you think and cost twice as much as you think. If you plan around that, you might have a better chance of getting it done. What profit are you giving away by using private money versus hard money? The rate still has to be pretty high if you have no flipping experience. Meaning why is someone or some people making funds available to you if you've never flipped before?

Darius Ogloza · Answer

@Justin Peucker The feasibility of a fix and flip project will depend on many factors - it's hard to give good advice when there are so many unknowns:

where are you planning to flip? what's the market like in that location? what is expected purchase price to ARV ratio? do you have a handle on renovation and carrying costs? have you done this before (it seems not from your post but not 100% sure)? what is competition for flips like?  have either of you managed complex projects? do you have access to reserves in case of an overrun?

A lot of money can be made on flips.  It's also easy to lose your shirt.  Devil is in the details.