Percentage Deal on a Flip

2 Replies

Hi everyone. I am an agent in Nashville and specialize in sourcing fix and flip deals. Although I am in Nashville, I am curious to hear from everyone as well as those in Nashville. I am interested to hear what percentage of deal you typically like to buy as an investor for a flip property. I understand obviously you want the best deal possible, but to be realistic, what would you find as a good percentage to make a desirable profit? For example, I know the Nashville market has been hot and finding a deal under 74% is becoming more and more rare. More frequently I will see deals go at or around 76-79% and investors are still able to make a healthy profit. What do you guys think and what do you guys find acceptable? As an agent who is usually on the opposite side of the fence, I am curious to hear what buyers/investors have to say.

Why are you interested in the percentage?   The reason you are asking this question is a percentage tells you nothing about the actual dollars since you are not applying the percentage to an actual property.

@Joseph Muench Nashville is a crazy hot market! 

I never look at percentage - it's a good place to start but like @Joe Villeneuve says it doesn't tell you what you're actually making in dollars. 

We always look for a minimum 15% return on the money put into our flips (loans, repairs, holding costs, etc.). 

You mention some folks are buying lower profit deals. I have seen many investors buy bad deals but get bailed out because of great market appreciation. I know Nashville had almost double digit appreciation last year. You can make a lot of mistakes and still make money when the market is appreciating ~10%/yr. 

Hope that helps!

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