flip rehabs/returns - how do i compete?
i am having trouble competing with other flippers. i try to do things the right way (pull permits) & use contractors/hvac/plumbing/electricians who, i feel, give me the best bang for the buck. and we all know the cost of things, and labor, have risen dramatically lately.
i pay cash for my homes and hit the sales price i anticipated beforehand.
the problem i am having is getting my rehab numbers in line. i feel other investors are doing rentals or doing some/all the work themselves and/or not pulling permits.
i should also mention, i do not need to flip. i can live off the returns i get in my bond/stock portfolio (w/ a lot less taxes paid). however, i like to flip 1x/year to keep me from getting bored and get that satisfaction from "working" (i retired 4 years ago).
and no, i am not interested in doing rentals. :)
Most Popular Reply
What permits are required depends on your specific location - some areas are more lenient than others. With that said, yes, flippers can and do a lot of the work themselves to save costs but that all comes with a potential downside. If a permit is required and was not pulled, you can be red tagged and then you will have an inspector on your back until the project is done and likely on future projects. Another downside if if you sell the house and permits were not pulled and there is an issue with one of the systems that required one, you as the flipper can be legally liable for having done the work uninsured and without a permit. I find it a lot easier and less stressful to get a licensed trades person to pull a permit for jobs where it is required than cut costs and not. I have had trades people quote me two prices - one with permits and one without. I tend to find another person to do the work. I understand that in many cases the local inspector knows far less than the person that did the work but at least it was permitted and inspected.
If your numbers are coming in where you want them and the profit is there, I would not worry about the corners other flippers are cutting as it sounds like you are doing it the right way.