New investor advice Tampa

8 Replies

I'm moving to Tampa in a few months and I'd like some advice on starting out flipping properties. I'll be starting out doing everything myself until I gain enough capital to hire contractors. Advice appreciated!

@Alia Bennett what type of construction/contractor experience do you have?

Easy flipping in Tampa is long gone. The easy money has been made. To make money flipping here you need to buy distressed properties, meaning they likely need electrical, plumbing, roof, HVAC, etc.... If you are comfortable with those tasks, the best advice I can give is that when you figure out your rehab budget and timeline, double both.

I cringe at "3 month flips", they dont happen. Count on 6 months minimum, probably 9 close to close.

@Alia Bennett Welcome to Tampa! Just to give you a heads up: Tampa's saturated with flippers and investors. Deals are getting harder to come by. You might want to consider other areas as well such as Lakeland, Plant City, etc.

I don't have any tips for you about how to start as I'm not in the flipping business but I wish you good luck :)

It's good that you're doing the repairs yourself, you will save money that way and should be able to carve out a profit. Something to think about when you gain enough capital to hire contractors: if you're hiring out the work and paying someone to find the deal for you (realtor, wholesaler, etc) there is very little chance there will be any profit left at the end. 

There's only so much money in each deal. If a wholesaler is taking a cut, a lender is taking a cut, and a contractor is taking a cut, at the end you will be lucky to break even.

I must say that I agree with the comments about how few easy flips are left. The distressed properties are hard to assess. You don't know how bad they are until you dig in! There might be a few insider deals but I think you have to be established with realtors or attorneys to get those calls. They want a quick and easy close if something comes their way and you better be cashed up and ready to act.

Right now, I have one of those distressed properties and I am thinking about knocking it down and just waiting for appreciation on the lot. Quotes to rebuild are from $150 to $300 per sf from builders. All the money would go to them - after 9 months of waiting for them to finish. I don't want to try owner/builder. In Florida, there is a one year requirement to wait to sale or lease if you pull your own permit. That is just one reason that I don't want to try owner/builder. A "one and done" project for subcontractors would NOT be a priority and I see nothing but problems.

I'd recommend you to get on some wholesaler lists. I just found my first flip deal through a wholesaler. I crunched the numbers 3 different times, stayed very conservative and I calculated everything like I would need a contractor. I plan on doing some of the work myself but you're not going to find me up in a tree trying to save a buck. I'm going to hire out what I need to. I'd also recommend coming to the TBREIA. The main meeting is tonight @ 7 actually over at the Godfrey/WTR. I met a lot of good contacts there.

Hope this helps!

From a lender's perspective, your situation is why we exist! Unless you have a lot of handyman/contractor skills yourself, you'll be hard pressed to add enough value to a property to make it worth the effort Consider taking out a short term loan to fund the rehab projects, upgrades, and maybe additional features that will get you the highest return on your work, money, and risk! As long as you have relatively good credit, a source of income, and a strong calculation of how you'll manage financially through the duration of the project, a reliable lender will be happy to fund your projects. This should make it much easier for you to get some momentum going and eventually enough capital in your business where you can take on properties to rehab without borrowing as much money. 

Good luck! Tampa is a great location!