House flipping - Paint Talk - Professional Painting Contractors Forum
CLICK HERE AND JOIN OUR COMMUNITY TODAY, IT'S FREE!
Go Back   Paint Talk - Professional Painting Contractors Forum > Paint Talk Community > Off Topic (Non Trade)

Reply
 
Thread Tools Display Modes
Old 01-10-2016, 07:12 AM   #1
Senior Member
 
Join Date: Oct 2012
Location: Delete this account
Posts: 8,761
Rewards Points: 250
Thanks: 4
Thanked 13 Times in 12 Posts
View Epoxy Pro's Photo Album My Photos
Default House flipping

How many of you flip houses? How did you decide what to take on for your first flip?

Carly & I are saving to take the plunge. I'm figuring by Spring time we should be ready to dive in.
Epoxy Pro is offline   Reply With Quote

Warning: The topics covered on this site include activities in which there exists the potential for serious injury or death. PaintTalk.com DOES NOT guarantee the accuracy or completeness of any information contained on this site. Always use proper safety precaution and reference reliable outside sources before attempting any construction or remodeling task!

Sponsored Links
Advertisement
 
Old 01-10-2016, 07:57 AM   #2
Renegade Mod
 
Wolfgang's Avatar
 
Join Date: Nov 2008
Posts: 10,147
Rewards Points: 516
Thanks: 7,386
Thanked 8,617 Times in 4,014 Posts
View Wolfgang's Photo Album My Photos
Default

The wife and I did it for awhile. I should say it was the wife's idea. She started with $50k. First house she bought was $30k and we put just $12K into it. Sold at $81K. Next house was $38K, about $9K into it, sold at $85K. She did 2 or 3 others.

First you have to know the market. Then the neighborhood and comps. We stayed in a certain price range mainly for ease of selling and really targeted first time buyers. Granted she had cheap labor....me. It was a lot of work on my part with running a full-time business but she pitched in as much as she could.

Where your budget can go really out of whack is if you run into plumbing, electrical, foundation and structural problems. Be realistic in what you figure it's going to take and how long it's going to take.

Then you have to figure out and wait out how long it's going to take to sell. If you're working with borrowed money, every month it's still on the market is costing you money. If you're working with your own cash, not so much, depending on what kind of return you expect.

Now I know some of you may think that an $85K house can't be much of a house, but what you can buy for $85K here may well be $160k+ elsewhere. Location, location, location.
__________________
Sweeping the streets of PT, one day at a time.
Wolfgang is offline   Reply With Quote
The Following 3 Users Say Thank You to Wolfgang For This Useful Post:
Dave Mac (01-10-2016), MIZZOU (01-10-2016)
Old 01-10-2016, 08:18 AM   #3
Senior Member
 
Join Date: Oct 2012
Location: Delete this account
Posts: 8,761
Rewards Points: 250
Thanks: 4
Thanked 13 Times in 12 Posts
View Epoxy Pro's Photo Album My Photos
Default

I know electrical, plumbing or foundation work can be costly. The houses sell for a bit more around here average home sale price is roughly 350k-500k.

We are hoping to have at least 75k saved by spring time. I figure if we can keep 10-15k from this 75k that will be what we use for remodeling.
Epoxy Pro is offline   Reply With Quote
Sponsored Links
Advertisement
 
Old 01-10-2016, 08:40 AM   #4
Renegade Mod
 
Wolfgang's Avatar
 
Join Date: Nov 2008
Posts: 10,147
Rewards Points: 516
Thanks: 7,386
Thanked 8,617 Times in 4,014 Posts
View Wolfgang's Photo Album My Photos
Default

Which means you're gonna be borrowing money to buy the house. $300K house with $60k down, $15K remodel budget. You prepared to possibly pay 2 - 6 months mortgage payments on the loan? Keep in mind that these payments and all your initial and selling loan fees will come out of any potential profits.

My rule has always been that unless I can use my own money for the initial purchase and remodel costs, I don't do it. One wrong experience could cause you some serious financial headaches.
__________________
Sweeping the streets of PT, one day at a time.
Wolfgang is offline   Reply With Quote
The Following 6 Users Say Thank You to Wolfgang For This Useful Post:
Dave Mac (01-10-2016), Gough (01-10-2016), MIZZOU (01-10-2016), Rbriggs82 (01-10-2016), stelzerpaintinginc. (01-12-2016)
Old 01-10-2016, 09:18 AM   #5
Paint to fish

 
DeanV's Avatar
 
Join Date: Apr 2007
Location: MI
Posts: 9,355
Rewards Points: 148
Thanks: 954
Thanked 5,137 Times in 2,796 Posts
View DeanV's Photo Album My Photos
Default

Remember that you make your money when you buy. if you buy wrong, you can't make it up later.


Sent from my iPhone using Tapatalk
DeanV is offline   Reply With Quote
The Following 4 Users Say Thank You to DeanV For This Useful Post:
Gough (01-10-2016), Stretch67 (01-10-2016), Wolfgang (01-10-2016)
Old 01-10-2016, 12:38 PM   #6
Senior Member
 
PACman's Avatar
 
Join Date: Oct 2014
Location: North central Ohio
Posts: 11,255
Rewards Points: 2,102
Thanks: 2,999
Thanked 4,704 Times in 3,172 Posts
View PACman's Photo Album My Photos
Default

Hey I know a painter who can paint two a day!
__________________
"One who dares not offend cannot be honest." Thomas Paine-patriot

"I'll have a double scotch with a twist of bourbon" Rodney Dangerfield
PACman is offline   Reply With Quote
The Following User Says Thank You to PACman For This Useful Post:
Gracobucks (01-10-2016)
Old 01-10-2016, 12:47 PM   #7
Senior Member
 
MIZZOU's Avatar
 
Join Date: Nov 2012
Location: St. Joseph MO
Posts: 1,181
Rewards Points: 564
Thanks: 1,435
Thanked 1,331 Times in 565 Posts
View MIZZOU's Photo Album My Photos
Default

Before we purchased our current home, we bought 3 fixer uppers in a row. I would make them livable prior to moving in, and work on the house every spare minute I had. We lived in, and remodeled the houses for 2 years to avoid capital gains. On average we made about 50k on each house. Do that 2-3 times and you can pay cash for the next 👍.

I have a contractor friend of mine that does flips through an investor. The investor finds the properties and fronts all cost of purchase and investment. Contractor provides all labor. The kicker is that he doesn't pull any payment throughout the entire remodel until the home sells. When the home sells, the 2 of them split the net profit. Some details may be off but that's somewhat how he explained it to me. Said his portion of the last sale was 28k and he had a little under 2 months invested.
MIZZOU is offline   Reply With Quote
The Following 3 Users Say Thank You to MIZZOU For This Useful Post:
Dave Mac (01-10-2016), Rbriggs82 (01-10-2016)
Old 01-10-2016, 05:15 PM   #8
Senior Member
 
Dave Mac's Avatar
 
Join Date: May 2007
Posts: 4,539
Rewards Points: 2,922
Thanks: 4,377
Thanked 2,491 Times in 1,405 Posts
View Dave Mac's Photo Album My Photos
Default

Hey Wolf how did you go about finding the homes??
__________________

To view links or images in signatures your post count must be 10 or greater. You currently have 0 posts.

powerwashingcharlottenc
Housewashingcharlottenc
Dave Mac is offline   Reply With Quote
Old 01-10-2016, 10:06 PM   #9
Senior Member
 
Join Date: Jun 2009
Location: Oklahoma
Posts: 1,296
Rewards Points: 878
Thanks: 81
Thanked 592 Times in 386 Posts
View jacob33's Photo Album My Photos
Default

Personally I'm like wolf I do not buy things I can not buy outright. I think its too much risk. I do not own flip property but some rental property and I can attest that it being paid for makes it much easy to manage properly than just making sure a check is coming in to pay the mortgage. I can be picky about what tenants I rent to because I do not just have to fill it. I see other people with rental property scrambling to fill vacancies when I do not have to.
__________________

To view links or images in signatures your post count must be 10 or greater. You currently have 0 posts.
jacob33 is offline   Reply With Quote
Old 01-10-2016, 10:31 PM   #10
Senior Member
 
Join Date: May 2011
Location: Winnipeg, Manitoba
Posts: 574
Rewards Points: 158
Thanks: 382
Thanked 369 Times in 217 Posts
View Gracobucks's Photo Album My Photos
Default

We have done a few houses already. Mostly get them in winter to keep the guys busy in the slow season. We do get a mortgage on the properties and still pull out a good profit. The trick is don't rush into a property just because you want to flip a house. Wait for the perfect place at the right price that you can make money with. Also don't over do your houses. A lower end neighborhood doesn't require granite counter tops and hardwood floors, but a higher end neighborhood does require these items. I have had my best profit from the lower end neighborhoods. Seem to be easier to do everything by yourself and go alot faster. Remember that your building a house that everyone will love, not a house you are moving into.

It will take up alot of your time Dave, I have a crew of guys that still paint while I work on the houses. It would be hard to do both at once. Don't know how many guys you have going, but make sure you don't get over your head. You'll still need the painting business to pay the bills while you flip the house. There is no pay checks coming from the house untill it is sold and the lawyers decide to release the money.
Gracobucks is offline   Reply With Quote
The Following User Says Thank You to Gracobucks For This Useful Post:
Wolfgang (01-11-2016)
Old 01-10-2016, 10:38 PM   #11
Senior Member
 
Join Date: May 2011
Location: Winnipeg, Manitoba
Posts: 574
Rewards Points: 158
Thanks: 382
Thanked 369 Times in 217 Posts
View Gracobucks's Photo Album My Photos
Default

Quote:
Originally Posted by Dave Mac View Post
Hey Wolf how did you go about finding the homes??
You need a good realtor to get the best buys. Someone that will send you the houses as soon as they hit the market. Sometimes before the do. Go see it asap and make a offer quick. There are tons of people doing the same thing and the good houses are gone fast. I have also tried mortgage sales, but lately they have been going stupid. People are paying way too much for a house that you can't look in before you buy. You also can not be scared of dirt. The cheapest houses are the dirtiest house out there. Be prepared to clean some of the worse messes ever.
Gracobucks is offline   Reply With Quote
The Following User Says Thank You to Gracobucks For This Useful Post:
Dave Mac (01-10-2016)
Old 01-11-2016, 05:04 AM   #12
RePaintFlorida.com
 
Repaint Florida's Avatar
 
Join Date: May 2012
Location: Orlando, Florida
Posts: 1,738
Rewards Points: 306
Thanks: 1,943
Thanked 2,717 Times in 1,014 Posts
View Repaint Florida's Photo Album My Photos
Default

Quote:
Originally Posted by cdpainting View Post
I know electrical, plumbing or foundation work can be costly. The houses sell for a bit more around here average home sale price is roughly 350k-500k.

We are hoping to have at least 75k saved by spring time. I figure if we can keep 10-15k from this 75k that will be what we use for remodeling.
Personally i would be worried having only 10k / 15 thousand for reserve in flipping a 350k - 500k home along with a mortgage

i spend 10k a week just getting out of bed, payroll, paint, shop, trucks, insurance, ect it goes fast

jmo
__________________
Repaint Florida LLC
1460 Gemini Blvd
Suite 10
Orlando, Fl 32837
Repaint Florida is offline   Reply With Quote
The Following 4 Users Say Thank You to Repaint Florida For This Useful Post:
Dave Mac (01-12-2016), Gracobucks (01-11-2016), lilpaintchic (02-02-2016)
Old 01-11-2016, 08:16 AM   #13
Renegade Mod
 
Wolfgang's Avatar
 
Join Date: Nov 2008
Posts: 10,147
Rewards Points: 516
Thanks: 7,386
Thanked 8,617 Times in 4,014 Posts
View Wolfgang's Photo Album My Photos
Default

Quote:
Originally Posted by Dave Mac View Post
Hey Wolf how did you go about finding the homes??
The first one the wife found on her own. A couple of the others were through my banker. The last one a friend told me about.

The problem around here was that real estate agents were grabbing the houses before the average Joe had a chance. (Of course they wanted all the work done dirt cheap.) Was talking to my banker about it and he would call me if they had anything.

When we bought the house in Marcos Island, I tried to go through a real estate agent. Once they found out I was a retired contractor, everything they showed me was a fixer-upper even though I told them I didn't want anything like that. Just wouldn't listen. Finally my banker got a hold of a banker friend of his and we had three nice properties to look at. The one we chose still had about 45 days of the forclosure process to go through. Put a bid in at about 40% of the market value, figuring I'd go up as I had to. They took it. $600K house for $240K. Of course this was when the market crashed down there, but I figured I wasn't getting hurt at that price.
__________________
Sweeping the streets of PT, one day at a time.
Wolfgang is offline   Reply With Quote
The Following User Says Thank You to Wolfgang For This Useful Post:
Dave Mac (01-12-2016)
Old 01-11-2016, 08:28 AM   #14
Renegade Mod
 
Wolfgang's Avatar
 
Join Date: Nov 2008
Posts: 10,147
Rewards Points: 516
Thanks: 7,386
Thanked 8,617 Times in 4,014 Posts
View Wolfgang's Photo Album My Photos
Default

The reason I used the Marcos Island house as an example is that even though we were purchasing it for a residence for ourselves, we went into with the "house flip" thought process. No mortgage and at our age and my health, I didn't want the wife saddled with any sort of hassles if she chose to sell it if something happened to me.

I don't put a lot of emotional attachment into these decisions. Strictly business.
__________________
Sweeping the streets of PT, one day at a time.
Wolfgang is offline   Reply With Quote
The Following User Says Thank You to Wolfgang For This Useful Post:
Gracobucks (01-11-2016)
Old 01-11-2016, 09:11 PM   #15
Senior Member
 
Join Date: May 2011
Location: Winnipeg, Manitoba
Posts: 574
Rewards Points: 158
Thanks: 382
Thanked 369 Times in 217 Posts
View Gracobucks's Photo Album My Photos
Default

Quote:
Originally Posted by Wolfgang View Post

I don't put a lot of emotional attachment into these decisions. Strictly business.

This is the most important thing to flipping. If you don't listen to this advise. DON'T FLIP

Last edited by Gracobucks; 01-11-2016 at 09:13 PM..
Gracobucks is offline   Reply With Quote
The Following 2 Users Say Thank You to Gracobucks For This Useful Post:
lilpaintchic (02-02-2016)
Old 01-12-2016, 06:33 AM   #16
Senior Member
 
Join Date: Oct 2012
Location: Delete this account
Posts: 8,761
Rewards Points: 250
Thanks: 4
Thanked 13 Times in 12 Posts
View Epoxy Pro's Photo Album My Photos
Default

Quote:
Originally Posted by Gracobucks View Post

This is the most important thing to flipping. If you don't listen to this advise. DON'T FLIP
I mentioned this to Carly. She said if we don't emotional attachment it wont come out good. I said it's a business decision. No attachment to the home what so ever other wise it wont work.

Since I watched 1 house flipping so does that make me an expert?
Epoxy Pro is offline   Reply With Quote
The Following User Says Thank You to Epoxy Pro For This Useful Post:
lilpaintchic (02-02-2016)
Old 01-12-2016, 08:46 AM   #17
Troy
 
stelzerpaintinginc.'s Avatar
 
Join Date: May 2012
Location: Portland, OR
Posts: 1,908
Rewards Points: 144
Thanks: 2,043
Thanked 2,554 Times in 1,123 Posts
View stelzerpaintinginc.'s Photo Album My Photos
Default

I was a licensed Realtor here in OR up until the last market crash, then I got out. Saw a lot of people make a ridiculous amount of money. At that time, I had the same core group of employees for over a decade, so I had the time to learn about real estate, laws, trends & markets. When the economy tanked, I saw a lot of good people lose everything.

If you & Carly are serious about this, you might consider having one of you get licensed as a Realtor. Not only could you possibly save the additional expense of buying/selling commissions, and have access to the all of the properties available, it will help you make an informed decision when trying to determine whether or not to purchase a home.
__________________
Troy Stevens, Stelzer Painting Inc.
To view links or images in signatures your post count must be 10 or greater. You currently have 0 posts.
stelzerpaintinginc. is offline   Reply With Quote
Old 01-12-2016, 05:53 PM   #18
Senior Member
 
Join Date: May 2011
Location: Winnipeg, Manitoba
Posts: 574
Rewards Points: 158
Thanks: 382
Thanked 369 Times in 217 Posts
View Gracobucks's Photo Album My Photos
Default

Quote:
Originally Posted by cdpainting View Post
Since I watched 1 house flipping so does that make me an expert?
Yes, it does. As long as it was a hour long show and not a 30 minute one.
Gracobucks is offline   Reply With Quote
The Following User Says Thank You to Gracobucks For This Useful Post:
lilpaintchic (02-02-2016)
Old 01-12-2016, 05:59 PM   #19
Senior Member
 
Join Date: Oct 2012
Location: Delete this account
Posts: 8,761
Rewards Points: 250
Thanks: 4
Thanked 13 Times in 12 Posts
View Epoxy Pro's Photo Album My Photos
Default

Quote:
Originally Posted by stelzerpaintinginc. View Post
I was a licensed Realtor here in OR up until the last market crash, then I got out. Saw a lot of people make a ridiculous amount of money. At that time, I had the same core group of employees for over a decade, so I had the time to learn about real estate, laws, trends & markets. When the economy tanked, I saw a lot of good people lose everything.

If you & Carly are serious about this, you might consider having one of you get licensed as a Realtor. Not only could you possibly save the additional expense of buying/selling commissions, and have access to the all of the properties available, it will help you make an informed decision when trying to determine whether or not to purchase a home.
We agree on this. One of will go and get licensed this winter.
Epoxy Pro is offline   Reply With Quote
Old 01-12-2016, 06:04 PM   #20
Senior Member
 
Join Date: Jul 2013
Location: Central Florida/Mount Dora
Posts: 2,330
Rewards Points: 200
Thanks: 4,778
Thanked 2,427 Times in 1,272 Posts
View SemiproJohn's Photo Album My Photos
Default

I've never purchased a house to flip, but I've sure worked in a bunch that others were trying to flip. Other than location being a big key, a very thorough inspection, by someone who knows what he/she is doing is what I would consider of utmost importance. What is the actual condition of the roof? Are the windows installed properly? Do they leak? How is the electrical wiring? What is the condition of the hot water heater? Are there leaky faucets or bad shut-off valves under the sinks, what is the condition of the water lines, are there soft spots under carpeting/flooring? What about the air conditioning/heat pump? Is there decent insulation? What is the condition of exterior wood at the eaves, behind fascia?

These are just off the top of my head. Failure to notice structural problems pertaining to roofing, flooring, plumbing, electrical, and ac/heat will come back to really bite you in the pocket. I always assume there is a reason a house is selling for a "good" price, and that reason is often hidden.
__________________
We are the music makers, and we are the dreamers of dreams.
SemiproJohn is offline   Reply With Quote
The Following 2 Users Say Thank You to SemiproJohn For This Useful Post:
Dave Mac (01-12-2016)
Reply

Tags
None

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Have you ever painted in a haunted house? ptbopainter General Painting Discussion 19 11-14-2015 08:24 AM
I Wonder if the house has killed them yet jennifertemple General Painting Discussion 11 11-09-2015 05:23 PM
Inspiring House Painting Blogs merichard69 General Painting Discussion 9 08-15-2015 12:08 AM
Another shake problem, another house pvtgloss General Painting Discussion 13 08-07-2015 10:45 AM


All times are GMT -4. The time now is 03:24 AM.


Powered by vBulletin® Version 3.8.8
Copyright ©2000 - 2019, vBulletin Solutions, Inc.
Content Relevant URLs by vBSEO 3.6.1
vBulletin Security provided by vBSecurity v2.2.2 (Pro) - vBulletin Mods & Addons Copyright © 2019 DragonByte Technologies Ltd.
User Alert System provided by Advanced User Tagging (Pro) - vBulletin Mods & Addons Copyright © 2019 DragonByte Technologies Ltd.
Our Pro Sites Network
ContractorTalk.com | DrywallTalk.com | ElectricianTalk.com | HVACSite.com | PlumbingZone.com | RoofingTalk.com