Flip property or rental property

[Scott Howell]

My main focus is going to be flipping for now. As I look for deals, my main issue is saying to myself, "would this be better off a rental?" What's the best metric for you in determining this?

[Cody L.]

I started that way. I'd buy a SFH to flip. But then tossed renters in there. My feeling was if I had a renter in there I could list it for more since I was under no time pressure to sell (since I had income) so could wait for the right buyer.

The downside to this is even though the properties made great cash flow, finding a buyer was hard as most SFH buyers are looking to live in it. They wanted the renters out as a condition of closing. I told them I can only do that once there is hard money. And we ran into a chicken/egg issue.

So I finally decided that if I needed all my equity to keep growing, I'd sell. Till then, id keep them rented. That way the houses work as a piggy bank providing cash when needed.

I still do that in a way today. Except you can get such high LTV that you can get almost as much cash out with a refi as you can a sale. So why not just refi and keep the income?