Lender · Sanford, NC · Member since 2024 · 347 posts · 116 votes
I’ve had experience with real estate investing in the past, but now I’m planning to dive into fix & flip projects. Even though I know the numbers well from my previous experience, I’m sure there are some unique challenges when it comes to flips—like managing renovations, timelines, and of course, staying on budget.
For those of you who made the transition or started out flipping, what’s something you wish you knew before your first project? Whether it was a win or a tough learning experience, I’d love to hear your insights on what you’ve learned about flipping that’s different from other types of investments. I’m gearing up for my first deal and want to go in with as much knowledge as possible. Thanks in advance!
I’ve had experience with real estate investing in the past, but now I’m planning to dive into fix & flip projects. Even though I know the numbers well from my previous experience, I’m sure there are some unique challenges when it comes to flips—like managing renovations, timelines, and of course, staying on budget.
For those of you who made the transition or started out flipping, what’s something you wish you knew before your first project? Whether it was a win or a tough learning experience, I’d love to hear your insights on what you’ve learned about flipping that’s different from other types of investments. I’m gearing up for my first deal and want to go in with as much knowledge as possible. Thanks in advance!
Add two months to your projections of how long it will take. Once the flip is completed, it takes at least a month on the MLS then another month to close after you get an offer.
Add an additional two months for the contract to fall through due to buyer trying to negotiate like they are on the cast of Pawn Stars.
I’ve had experience with real estate investing in the past, but now I’m planning to dive into fix & flip projects. Even though I know the numbers well from my previous experience, I’m sure there are some unique challenges when it comes to flips—like managing renovations, timelines, and of course, staying on budget.
For those of you who made the transition or started out flipping, what’s something you wish you knew before your first project? Whether it was a win or a tough learning experience, I’d love to hear your insights on what you’ve learned about flipping that’s different from other types of investments. I’m gearing up for my first deal and want to go in with as much knowledge as possible. Thanks in advance!
Add two months to your projections of how long it will take. Once the flip is completed, it takes at least a month on the MLS then another month to close after you get an offer.
Add an additional two months for the contract to fall through due to buyer trying to negotiate like they are on the cast of Pawn Stars.
Investor · Topeka, KS · Member since 2020 · 669 posts · 488 votes
1y
@Deborah Wodell here's one that might be useful to you. Always pad a percentage of your budget for overages. Smaller budgets will need a higher percentage. See below
$20,000 renovation, add 25%. Why? Because your x-ray vision missed the broken sewer line, broken hvac, you thought those hardwood floors under the carpet were better than they really are, etc. Small budgets can get blown up easily by one or two issues that you missed during your walkthrough.
$100,000 renovation, add 10%. Why? If you are doing your part and really looking at the property and dug in deep on the underwriting, you should be good to go. There is a lot more budget there to absorb a few hits.
Also, at the end of the day, if you have budget left over, make a draw and enjoy that tax free money.
Investor · Chicago Suburbs · Member since 2021 · 46 posts · 37 votes
1y
Hi Deborah--Hands down understanding that EVERY house has a ceiling on value. You can't charge more because you did more; more updates/upgrades do not necessarily translate to a higher sales price. As a GC by trade, I have subs every week pushing to do more in a certain area saying 'You can just charge more for the house.' Your construction team does not always get what you are doing. They are tradesmen not investors so remember that when they dole out advice. My guide is asking this question..."is this a deal breaker for a buyer? Is this weird?" Best of luck