Flip or Buy and hold?

8 Replies

Hi dear community,

I'm a rookie out-of-state investor in a middle of a dilemma with myself, I've got my first proprety in port st lucie refinanced and was able to pull out 50k for the next move. Now, I've got my agent bringing me mls houses, but the numbers are not matching my excpectation (1% rule)

Now, I'll be staying for a month, so I'm telling myself I should try to partner on a rehab project. I know is always coming back to the question ''what are my goals" It's buy & holds (MF is the goal), but I'll like to build some cash aswell to get there.

what do you guys think??

Regards

Louis

from one rookie to another, stick to your plan!  Everything looks good when it’s on the other side of the fence but upon closer examination you usually find an unexpected issue that you didn’t plan for or have never really given any thought.  Buy and hold for passive income is so much different than flipping, one is fairly passive once the property is stabilized and provides ongoing income, the other is a job - find it, buy it, rehab it, sell it, REPEAT.

Tell your realtor what you are really looking for instead of them just trying to find you their next commission!

While it might be worthwhile to broaden your horizons and make some fast cash I would wait until you have your buy and hold niche down. I have heard this called the shiny object syndrome and occasionally suffer from it myself. If you really look at all the new stuff you would have to learn and all the effort that would have to go into a flip especially as a first deal that will seriously detract from your buy and hold investing.

Also consider this, generally if I look at a possible buy and hold I often think I wouldn’t need as good as a deal as for a flip or wholesale. If you can’t find a 1% deal will you be able to find a deal that will make a good flip? And if you can find a deal that would make a good flip why not BRRR it and add it to your portfolio.

Only you can say whether or not it is a good call for you but I always feel I will do better focused on a single goal rather than spreading myself over several.

Kick that plan to the curb!

Do whatever it takes to scoop up as much Florida Real Estate as fast as you can!

Contact an experienced "Mortgage Broker" for low down payment Investor loans as we can usually blow nay "direct lender" programs out of the water and all the "direct lenders" know this to be true!   

Also, always keep in mind your Passive Activity Loss Account, as this can help ease your mind and open up opportunities you may not have considered  

Thanks, for your views and opinions on this one, like I'll be there soon, I'll try to hook to a wholesaler or do a letter campaign. Regards Louis

Put as little as 15% apply on a 150k property.  Use the rest for rehab.

What if you run out of money?    See all the 0% balance transfer credit cards solicitation you get in the mail now days?

Some will apply for a 0% interest balance transfer and show their credit card balances as MAXED OUT.

Then, when they receive the 0% balance transfer checks, they simply do quick Cash Advances on those cards and come right behind the advances with the 0% interest balance pay off checks.

There are a lot of good potential flip properties that wouldn' meet the 1% rule (if refinance at the ARV).

You wrote your goal is MF rentals. If you will you need to raise a large amount of capital for downpayment on a MF then flipping might make sense to get there. If not, then maybe just accumulate more small properties.

@Louis Piront since you are already doing out of state investing why not look in other areas too where the numbers are better and opportunities are more plentiful.   

I'm familiar with the st. lucie area and looked there last year as it is only an hour north of me.  I myself have started looking out of state as #s here are so tight now.

There are still deals to be found but usually off-market.  I have local wholesalers send me stuff all the time and only a small % are decent deals.

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