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Updated 9 months ago on . Most recent reply

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Patrick Philip
  • Florida
107
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912
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Always use a realtor for flips?

Patrick Philip
  • Florida
Posted

So I just ran the numbers on a potential rehab property. Purchase = $310,000. Rehab = $80,000. ARV = $499,000.

My profits before realtors commissions = $71,585. After deducting $29,940 of commissions, profits = $41,645 and that is before income tax.

Do I REALLY have to use a realtor each time? I've never flipped a house before and I know MLS exposure is very important. Is there any way around this?

Most Popular Reply

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694
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Rick Santasiere
  • Real Estate Broker
  • Granby, CT
316
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694
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Rick Santasiere
  • Real Estate Broker
  • Granby, CT
Replied

I am going to offer a slightly different viewpoint, and it might not be very popular. Any flipper will build so much long term wealth having a good relationship with a realtor than without one.  Can you sell a house on your own? You bet! However, you will never get the value from yourself and your time (and lack of experience and knowledge) than you can with a great local resource who lives, eats, and breathes real estate sales and stats. Listen to all the great flippers on the podcasts. What do they say about using agents? Interesting, the successful ones know exactly how to work with realtors to maximize their return. If you are thinking about quick profits, but not long term strategy and scaleability, then do it on your own. But if you want to get better at the things YOU DO WELL, and maximize profits, then allow someone better than you at selling real estate to take that on for you. If you don't, you will be leaving a lot of $ on the table (sadly, you will THINK you were saving money..) One last thought. Your next deal might just come from that same realtor that you worked so hard to align yourself with... What if that agent brought you your next $50k profit flip. Was he/she worth the few thousand bucks?  I try not to add my opinions too strongly to these threads when they come up, but a lot of the opinions here have made me feel that a different viewpoint is warranted.  Sellers who sell without agents get 8% LESS than sellers who use a full service agent.  Look it up if you need to, or just keep thinking you are "saving" money :-) You decide... My $.02

  • Rick Santasiere
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