Newbie Here Residing in Maryland
Ladies & Gents, my name is Jimmy Fisher, and I'm new to the REI world.
I work a normal 9-5, but my plan is to start flipping in Baltimore, expand from there, and ultimately move into the rental market. I've had two bad personal experiences w/real estate (purchased right before the bubble burst), but I'm ready to get past those experiences, and make new and better ones.
I've looked at about 35 properties in Baltimore (about 8 w/the GC I intend to use), but haven't put in an offer on any of them yet. I've read both books by J Scott, and feel as though I have a good grasp of the basics involved with flipping. I got pre-approved through Wells Fargo for a conventional loan to use for my 1st flip, but based on the cash needed during the life of the process, I may decide to go w/a HML. I've done financial analysis ad nauseam, and the one question I have at this point is how do I determine if the projected profit from a flip is worth my time and money?
This forum has already provided me w/a lot of awesome information so thanks to all for that!
Most Popular Reply
Welcome to the site!
I'm not a flipper, but from my understanding, to check if a deal is worth your time or not, you need to calculate the ARV (after repair value) and make sure that your purchase price, total rehab costs, and everything else, is tied up at or below 70% of the ARV. Or 70% of the final selling price. And you can get what comparable, fixed up properties would sell for in your area from a good real estate broker.
Here's a link to a good article on the subject:
http://www.biggerpockets.com/renewsblog/2012/12/15...
Hope that helps, keep us updated!