Flipping Houses Is Harder Than It Looks
May 2nd, 2006 by Grant in: Real Estate
My brother sent me an article from Bankrate.com about making a living flipping houses, and how it’s much harder than it looks, requiring deep pockets going into the deal.
I found myself nodding my head as I read the article, as it had many good points. The get-rich-quick infomercials that you see on late night TV on how to make money in real estate with no money down are a figment of the imagination.
I like the idea in the article to take it slow, and do a few deals on the side and build up the cash reserves so that you can flip houses without needing a loan.
The article also mentions some tax implications if you are a “trader” rather than an “investor”, something I hadn’t thought about, but has some heavy tax considerations if you aren’t careful. Things such as 1031 exchanges don’t apply unless you are an investor.
A lot of good information for the new REI with dollar signs in his eyes.
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May 4th, 2006 at 7:54 pm
I have to agree 100%, flipping houses is very hard to do if you have a family, a full time job, and very little time on the weekends. I thought that I could get into the fix and flip thing quite easily but it requires A LOT of time just managing it.
I learned a heck of a lot from my House #1 rehab and I’ll do things differently next time :). Yes, there will be a next time.
Tom
“D”igital Breakfast