Hey everyone I'm curios to know, when analyzing a property, how do you determine if it's better as a flip or as a rental. Thank you

@Ethan Lahav in my experience, it's always better to flip SFHs. Having had over 100 single-family homes at one time, I'm not a fan of holding SFHs as a long-term rental strategy. You want to focus on short-term money generating strategies such as wholesaling, fix and flips, etc. You use the money from these deals to invest in long-term wealh building assets such as aparetment buildings. And you can do that as an LP or syndication, etc.

A good rental is always a good flip. But, a good flip may not be a good rental.

The more you are leveraged, the more money you make. Buy a $100,000 house for $100,000. If the property appreciates $25,000 in five years, you've gained $25,000 in equity. Buy four $100,000 houses with $25,000 down on each. If each roperty appreciates $25,000 in five years, you've gained $100,000 in equity. Your money is growing four times faster than if you had purchased just one home. If you buy a house for all cash, you obviously have more cashflow. However, the cashflow is unlikely to make up for the increased equity gains, reduced vacancies, tax deductions, and other benefits that come from diversifying. I recommend you build a strong foundational understanding of real estate investing. 1. Start with BiggerPockets Ultimate Beginners Guide (free). It will familiarize you with the basic terminology and benefits. Then you can read a more in-depth book like The Book On Rental Property Investing by Brandon Turner or The Unofficial Guide to Real Estate Investing by Spencer Strauss. 2. Get your finances in order. Get rid of debt, build a budget, and save. The idea that you can build wealth without putting any money into it is a recipe for disaster and the sales pitch of gurus trying to steal your money. A wise investor will not try to get rich quick with shortcuts. If you can't keep control of your personal finances, you are highly unlikely to succeed in real estate investing. Check out my personal favorite, Set For Life by Scott Trench , or The Total Money Makeover by Dave Ramsey. 3. As you read these books, watch the biggerpockets podcasts. This will help clarify and reinforce what you are reading. You can hear real-world examples of how others have built their investment portfolio and (hopefully) learn to avoid their mistakes. 4. Now you need to figure out how to find deals and pay for them. Again, the BiggerPockets store has some books for this or you can learn by watching podcasts, reading blogs, and interacting on the forum. There is a handy search bar in the upper right that makes it easy to find previous discussions, blogs, podcasts, and other resources. Biggerpockets also has a calculator you can use to analyze deals and I highly recommend you start this as soon as possible, even if you are not ready to buy. If you consistently analyze properties, it will be much easier to recognize a good deal when it shows up. Find Brandon's videos on YouTube for the "four square" method of analyzing homes and practice. It doesn't take long to learn how to spot a good deal.5. Study the market. You can learn to do this on your own or get a rockstar REALTOR to lead the way. I highly recommend a well-qualified REALTOR that works with investors and knows how to best help you. 6. Jump in! Far too many get stuck in the "paralysis by analysis" stage, thinking they just don't know enough to get started. The truth is, you could read 100 books and still not know enough because certain things need to be learned through trial-and-error. You don't need to know everything to get started; you just need a foundation to build on and the rest will come through experience and then refining your education. You can build a basic understanding of investing in 3-6 months. How long it takes to be financially ready is different for everyone. Once you're ready, create a goal (e.g. "I will buy at least one single-family home, duplex, triplex, or fourplex before the end of 2019") and then do it. Real estate investing is a pretty forgiving world and the average person can still make money even with some pretty big mistakes.

Math is math. SFH can be turned over much faster than commercial or Multi. I don't buy multi though, so I've never applied it to it. I use commercial, specifically NNN, as the end of the line where I do the long term holds...because of the cost/income consistency. The process is to flip the cash (you don't flip properties, you flip cash...and make no mistake,...the property isn't the true asset, you cash is) through SFH as described above, then build your cash to roll it into the NNN for the long hall. You have to have a plan, and that plan must be based on numbers with $$$ in front. Not numbers with %%% behind (they lie, and tell you nothing of value when the just "fib"). Not emotional goals like becoming financially independent, or quitting the Rat Race. These are not goals, because without the numbers, they can not be measured. The goals are the numbers with $$$ in front that allows you to achieve that independence.

Impossible to answer, if you are happy with the profit from the flip vs getting rental income then do it , There is no right or wrong answer Good Luck

Hi Ethan, Run numbers on both scenarios and see which one has a better return on your investment for what your goals are. Also if you want a faster return then there's the flip but if you want a return over time theres the rental side. Benefits to both strategies but the numbers determine which one might be better.

Flipping houses is a job. You work for a period of time, you sell the house, you get a chunk of money, and then you are done. A long-term rental will bring money for the rest of your life and continue to grow in value. One makes fast money, the other brings long-term wealth.

I would eventually want to do both altough my focus is in buy and hold. I'm asking more on a specific property I come across with and crunch the numbers. What numbers will fit a flip and what will fit a buy and hold. Hope my question is clearer

Hi @Ethan Lahav, I think your question is missing something... I'm confused because ideally, you have a strategy and target what you're going after. When you ask how do you know what's better (rental vs flip) that makes me think you have a property that maybe you inherited or something, and you're trying to figure out what to do with it. I looked at your profile, but you didn't have any info. Can you let us know your strategy or what you want long-term? @Sabrina Sanchez talked about the speed of returns, faster for flips but longer for rentals. Like @Nathan G. said, flipping is a job, but long-term rentals are about cashflow. @Jim Pellerin talked about how you can use SFH flips to build up funds to get into multifamily. That's all good stuff... I'm curious though, what do you want from real estate investing? Are you considering getting into flipping or buy-and-hold? Rene G

How do you know if a property is better as a rental or a flip?How do you know if a property is better as a rental or a flip?

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How do you know if a property is better as a rental or a flip?

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