Resurrecting an older post here, but I am wondering the same thing. I believe I understand what the commenters are saying - don't factor in your living expenses because that may make a deal look more attractive, and you may pay more than you need to on a house...
We are wrapping up a slow motion live-in-flip, which will have ended up taking 3.5 years. (We have 2 small kids, and everything has taken twice as long as we expected). I'm looking back at what our profit will be after subtracting realtor costs, the money we put into renovations, etc... It looks kind of sad - especially for how long it has taken us. But I sit here thinking that we will have whatever of our principal that we have paid down back in our pocket. I guess that's not a profit because it was our money to begin with? But if we were living somewhere else, we wouldn't have gotten that money back. I feel like it should count for something. A little column on the side, a number with an asterisk...
The weird thing about it is that when we are done, assuming we sell for what I am imagining, we will have a lot of money in our pockets, but such a small amount will be actual profit. Most of it will be what we put into renovation costs. It's like a little savings account. I still feel good about what we have done. We learned so much, and are excited to do it again. This time in 2 years, of course!