What do you think about buying foreclosures and rehabs, spending all out on remodeling the joint to make it a smart luxury home, then flipping it? Depending on the location, it seems like it should prove quite profitable. If I'm just starting out, how many of those do you think I'd be able to bust out in my first year? I could probably start with the VA home loan, and go from there, eh?

Luxury homes don't sell like luxury homes in suburban neighborhoods and it is rare that luxury neighborhoods have foreclosures that need work.  Your biggest hurdle would be finding properties that fit the bill, realistically in a year you could probably do one, if you find a property that works.  The bottleneck would be finding the properties not doing the rehab.

You’d be trying to sell houses that are 30% or so more than the surrounding houses....this is “over improving” a house for the immediate neighborhood it is in....this does not work out well.

You can do this IF the area in question supports and already has homes of higher end luxury finishes and designs. I don’t know your area so I can’t speak to it knowledgeably, but in my area of southern CA, I concentrate in higher end areas with older homes where many other developers have already built Mc Mansions. I then buy an old, small, outdated home on a nice street where other newly built homes exist. I then knock it down (for the most part) and build a new modern home. The numbers have been working for a number of years however, the spreads have been compressing and as such, the profits have been more slim than in years past.

It is all about the numbers. Taking an average home on an average street and going over the top with finishes and design will not work as nobody will want to pay say $600k for your home when every other home is $450k just because yours has high end appliances, plumbing fixtures, and other higher end amenities.