In Flipping Houses, “Hope” is a 4-Letter Word

I was watching a flipping show last week about first-time flippers. On this episode there was a husband and wife team. The wife was asked about the ARV. She replied that she hoped it was worth X amount. She was a real estate agent by the way. Then she was asked about the repair budget and she again said they hoped they could do it for X dollars.

Now, I know these “reality” shows are not truly reality because they are somewhat scripted and there is a lot of artificial drama built in. Spoiler alert – they made money on the flip because – it’s a TV show. It wouldn’t be on TV unless there was a happy ending. But her use of the word “hope” was concerning.

Hoping Your Way To A Profitable Flip Is Not The Answer

How many newbie flippers hope they can make big money flipping houses? Hope won’t get them too far in flipping if they don’t know how to figure out an After Repair Value (ARV) of a rehab, or come up with an accurate repair estimate.

While you can never be 100% sure about the ARV until the house is under contract and closed, you should always do the research on comparable properties to arrive at an ARV estimate that, barring extreme events, you feel confident can be realized based on the level of rehab you are performing on the property. Also, if you are not comfortable estimating repairs find someone to help you or pay an experienced contractor to help you. The money you spend for a detailed estimate will be well worth it in the end.

“Hope” has no place in flipping. It’s as bad as Ralphie Parker using the F--- word. Don’t be surprised if someone breaks out some Lifebuoy soap to wash your mouth out. Please don’t hope your way through a flip. Please do research on your market and on comparable properties. Please educate yourself, or get educated on estimating repairs. If you take these simple steps you won’t need to h--- your flip is successful.