Buy and hold predicament

[Bradley Bissett]

I have renovated my house and flipped another successfully. I've got some experience but pretty green still. The money made on the flip paid off my wife's student loans which is awesome but now I don't have capital for improvements on this new opportunity. The new opportunity is to buy a house in my hometown for $58,500. The asking price is $63,500. I think this deal is a no brainer at $50,000 but the seller is a very experienced aging real estate investor so $58,500 was as low as he'd go. That was months ago and the house still had not sold. After renovations I think the house is worth $79,000 given my hometown market. 3 bedroom 1 bathroom 1500 sq ft. I can put money down but then I would have to borrow for the improvements. Which goes against the debt freedom I'm currently experiencing. Or I could borrow the whole purchase and Reno cost but then I'm left w a home that breaks even as a rental or flip. Is this a walk away situation? The house could be so nice and I feel like i can add some value but again it won't pay dividends for a long time. Should I buy and rent immediately and fix it up as I go bc it is on slightly above average condition. Should I buy and ask the bank of mom and dad to invest $5k w me. My wife supports me and has helped me think this through but I'm wondering if we're missing something. I'm drawn to the bones of this house. It's solid and on a dead end street which I love, and a baseball toss to the huge city park. Any ideas would be greatly appreciated. Thank bp nation! -Brad

[Joe Villeneuve]

Next time, don't spend the profits.  Accumulate the profits from a series of flips to generate a 2nd line of flips.  Then, accumulate profits from those two lines of flips to generate a third.

Now you start buying rentals from your profits...every time you flip those original 32 houses...over and over again.

The secret is to NEVER spend your money...only use it, as many times as you can....and then, compound the use of the profits from the houses generated from the cash you never spend.