First House Flip Strategy

4 Replies

Hello,

Hope all is well with everyone.  I'm an aspiring real estate investor with the ultimate goal to one day own an apartment complex and live my life with full financial freedom.   Although I am quite ambitious, I am far from reaching this goal.  I am currently in my last semester of college and am working a job that only pays me $15hr to sit at a desk and forecast all day... which has been driving me absolutely CRAZY.  

I've been doing lots of research on how to get into real estate and believe that Flipping Houses is the way to start.  So, after some research and readings that I've done, I've come up with a plan on how I'm going to reach my end goal of owning an apartment complex... I am still VERY new to this so I want to input my plan to y'all and hopefully get some input as to whether its doable, fixable, or completely crazy.  

P.S. Since I'm getting paid very minimally I am very far-fetched from being able to put money down for a loan...especially here in NJ where home prices are WAY up there.

  1. Research my local market and find a home that I believe to be flipable
  2. Since I'm not super knowledgeable yet, I then plan on reaching out to an experienced local Real Estate Agent and asking them their opinion on the property. Finding comps, what needs to be fixed, how long I can expect it to be on the market, ARV, etc... I plan using the agent to help me sell the property, which I hope will give them an incentive to help me.
  3. Find a contractor to give me an estimate on the repairs/rehab of the property.
  4. Once I've collected all of this, I plan on reaching out to private lenders and providing them with the information I found on the property which I HOPE will be reinforcement for them to invest their money in the property... Again I have a low paying job and live in a high priced area... so thats why I'm hoping to go this route than a hard money lender.
  5. If all of this goes as planned and I flip enough properties for a profit, all of my proceeds will be put into a savings account and used to buy an apartment complex at some point in the future.

So thats pretty much it, before all this I thought about doing wholesaling but know its harder to get sellers to sign their homes to you and I've never been a good salesman either, let alone any potential legal issues with it... so I don't think that's the right path for me.

Any input would be GREATLY appreciated!! thanks all.

@Brendan Turner Brendan, Sounds like you have the drive, attitude and energy to get this done. If I were you I would find someone with money but no time or ability to invest on their own. JV (joint venture) with them. They provide the money and you provide the knowledge, time and energy to get the property rehabbed and re-sold. Split the profit and if all works well keep going until you have enough to go it alone. Learn as much as you can so you can impress you partner with your knowledge. Search out a good real estate agent that is knowledgeable about investing. Start looking at properties now, pick a few locations and learn everythIng there is to know about the locations you chose. Know what is for sale, what has sold, where the schools are, what jobs are in the area, what the rents are, etc, etc. Talk with some lenders. You may find you will need to use hard money If the property needs work. The conventional Lender may not loan on a property that needs work. Talk with some contractors and see if you can get a handle on rehab costs for your area. You can also be the contractor and just hire subcontractors to do the work. Plumber, electrician, painter, flooring, etc. this can save you some rehab costs. Don't forget about the other costs involved, purchase costs, holding costs, selling costs. Use the Bigger Pockets calculators to estimate the project. Good luck.
@Brendan Turner I fully echo the previous comments. I did exactly that a year ago and have done 5 flips since then. You make half as much profit each time, but it gets you in the door and has a much higher chance of success when just starting out. Key will be finding the right partner. Since you have time, few financial resources, and no rehabbing experience, you’ll want a partner with maybe little time but plenty of knowledge and financial resources. Search around BP and your local RE meet-ups and see if you can find someone like that. Then go out and kick some tail! Best of luck to you.
Originally posted by @Chris Jensen :
@Brendan Turner I fully echo the previous comments. I did exactly that a year ago and have done 5 flips since then. You make half as much profit each time, but it gets you in the door and has a much higher chance of success when just starting out. Key will be finding the right partner. Since you have time, few financial resources, and no rehabbing experience, you’ll want a partner with maybe little time but plenty of knowledge and financial resources. Search around BP and your local RE meet-ups and see if you can find someone like that. Then go out and kick some tail! Best of luck to you.

 Hi Chris, so when you say that you echoed what Joe said in the previous comment, did you find a flipper or lender? Reading over your comments I came across the idea to find a flipper, found out the type of properties and profits their looking for, and doing my research based off that criteria.  

@Brendan Turner I partnered with a general contractor who knows rehabbing and has time, but doesn't have financial resources. I don't have the time or detailed knowledge, but I have plenty of financial resources.  We each bring skills and background to the partnership that the other doesn't. It's a great way to get started.  I'd recommend a similar partnership for you while you're getting started.  You can decide when you want to venture out on your own.