Yesterday Ralph, a
subscriber, sent us this question:
Is it possible to do flips and make a decent profit without doing the manual labor yourself? And if so, what is the average amount of money that needs to be invested into fixing up each property and what is the average profit after selling?
Here are answers to those 3 questions:
1. You don't want to be doing any of the labor yourself.
Your job is to oversee the flip. You drive out to the property 2-3 times per week and check on the progress.
You should be doing your flips without touching a hammer.
This allows you to build and expand a real estate business that is sustainable over the long term.
2. Every flip has a different rehab budget.
Some flips require lots of work while others require only cosmetic repairs and upgrades.
The key is to get an accurate and realistic estimate of the costs before you make an offer on a house.
3. According to Realtytrac's U.S. house flipping report, the average gross profit per flip was $55,000 last year.
Redfin recently did a study showing the average gross profit per flip was $102,400.
 |
| Ben Moskel |
The Redfin study included the purchase and sale prices from tens of thousands of flips.
Unlike Realtytrac, Redfin included the numbers from actual flips, and excluded certain transactions such as those between family members.
In other words, $102,400 gross profit per flip is likely more accurate.
IMPORTANT: This is the highest gross profit since Redfin began analyzing house flipping.
If you've recently decided to start flipping houses, your timing is right on the money.
