Flipping and renting?

Question

Anyone dabbling in both types of investments?  My husband and I are thinking about buying our first flip.  We currently have  3 rental units now and we weren't sure if we should just stick with renting.  Opinions?

Brett Russell · Answer

@Becky  Wolfe , I don't think this is really an issue of getting others' opinions... it just depends on what strategies fit your needs, skills, time availability, etc.

Brian Woods · Answer

I am a local rehab investor. It is not as easy as you see on tv. I would suggest teaming up with someone who has done it a few years OR find a mentor to walk you through a few but that could be pricey.

Darrell Shepherd · Answer

I've done lots of both and am mostly doing flips right now, although I just rented two because they didn't sell right away.  Just depends on your strategy and attitude.  They are VERY different businesses.

Renting right now is a good business.  You can buy at 50x rents(ish) and finance it at incredible rates AND get decent renters because they cant buy anything.  Back in '06 it was way harder to get those numbers and anyone with a heartbeat could get a mortgage so the renters were pretty lousy.

Personally I like the big checks over the little ones and find all the little BS that goes with rentals kind of annoying.  I'm sure there are plenty of people that find the headaches that come along with flips unbearable and like the "passive" approach better.

IMO, the more you learn to make opportunity work based on what comes at you the better.  Got a wrecked one you can pick up cheap enough to flip, flip it.  Got a light rehab you can slap some paint and carpet in for 10-15% discount to value, do it as a rental.  Its nice to have some monthly because budgeting around just  the big checks is a bear, but its real nice getting a few $40k+ check in between the rent rolls...

Keith Lynch · Answer

@Becky  Wolfe - there are strong opinions on all REI strategies so I'll throw my 2 cents in ......

We've been flipping in our market for better than 10 years and it has proven very successful for us. For the past 5+ years, we've primarily acquired distressed properties via foreclosure auctions. This obviously reduces (and can even eliminate) risk, as we're always buying below current market value. As always, most of the work is on the front end prior to purchase and you'll only win 3 or 4 out of 100 - if you're doing it right. :)

If you need some guidance or assistance with fix & flip and/or buying at auction, feel free to reach out.

Best of luck!

Bryan N. · Answer

If I buy a fixer upper, I flip to increase the rent, attract a better tenant, and reduce the maintenace costs.

Elizabeth Colegrove · Answer

I am a buy and hold investor. While I could do flips, I haven't because I haven't found more "amazing" buy for rentals than I can handle. Therefore to turn the into flips, I would lose at my true long term goal, cash flow.

Dooreuhn Cee · Answer

I am a buy and hold.  But I am starting do to flips to help capitalize the buy and holds rather than using salary.

Becky Wolfe · Answer

@Arlan Potter  Thanks for the advice.  I appreciate it!

Becky Wolfe · Answer

@Jeff McCaskey. Thank you for all of your input.  Very helpful!  Renting has been going very well for us.  We got some great deals and I think we both have learned a lot from our properties we have.  We bought our properties as foreclosures and did put a significant amount of work into them.  A book I read indicated we should stick with what we know with investments so that's why I was asking about what other people do.  Thanks again for all the advice.  Very much appreciated

Arlan Potter · Answer

For me, I tend to keep my properties. I find that I cn make as much renting for one year, as I can make selling the property for a profit. I don't flip properties, unless, I buy a house and determine that it might not be the best rental, and can sell it fast for a decent return. But if a property will make a good rental, no sale.

Flipping and renting?

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