Comments on: Economics of Flipping http://btcf.ngifford.com/2006/11/05/economics-of-flipping/?utm_source=rss&utm_medium=rss&utm_campaign=economics-of-flipping Just another WordPress weblog Sun, 17 Apr 2011 15:44:55 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Reader Question #1 « Bring the Cash Flow http://btcf.ngifford.com/2006/11/05/economics-of-flipping/#comment-95 Reader Question #1 « Bring the Cash Flow Sat, 18 Nov 2006 16:26:13 +0000 http://btcf.ngifford.com/?p=47#comment-95 [...] I’m not really sure what the Boston market is like.  You maywish to consider leasing out a property, or flipping a house or two to generate capital.  However, flipping is a risky business and one must very carefully plan out every eventuality prior to purchasing a house to flip.  I think flipping will become even more dangerous in the coming years as some of the air gets let out of the housing bubble.  For a light-hearted view of the Flipper Nation, check out this online video series. (It is worth a watch!)  There is also the question of flipping in a market which has a good potential for downturn.  I, for one, think it is still possible to flip a house as long as you do it right…  What does that mean?  You need to get in and out quickly, get the house on the market ASAP, know your market so that you can guarantee the house will sell fast, and keep in mind all of your expenses including depreciation of the market value. [...] [...] I’m not really sure what the Boston market is like.  You maywish to consider leasing out a property, or flipping a house or two to generate capital.  However, flipping is a risky business and one must very carefully plan out every eventuality prior to purchasing a house to flip.  I think flipping will become even more dangerous in the coming years as some of the air gets let out of the housing bubble.  For a light-hearted view of the Flipper Nation, check out this online video series. (It is worth a watch!)  There is also the question of flipping in a market which has a good potential for downturn.  I, for one, think it is still possible to flip a house as long as you do it right…  What does that mean?  You need to get in and out quickly, get the house on the market ASAP, know your market so that you can guarantee the house will sell fast, and keep in mind all of your expenses including depreciation of the market value. [...]

]]> By: Andy http://btcf.ngifford.com/2006/11/05/economics-of-flipping/#comment-94 Andy Mon, 06 Nov 2006 21:04:47 +0000 http://btcf.ngifford.com/?p=47#comment-94 You make some excellent observations. I think there is (or was) a fad of "flippers" who saw a TLC episode or two and decided to make a go of it. There are also people who have no experience building new properties and find out the hard way that there's more involved than they originally thought. Of course everyone has to start somewhere, I suppose. We are looking at moving into a slightly larger place, and this past weekend we toured a duplex "built" by two people who owned some land and wanted to do something with it. Like you described in your post, these two people also made some mistakes in the selection of materials. The most glaring defects though were cosmetic issues with the finishing work: oversized holes in the sheetrock for electrical outlets (that the face plates don't cover), poor spackling work, drywall nails that are quite visible with only paint to cover them, no Cat 5 cable pulled for a computer network, etc. It’s understandable that anyone selling a property is looking to turn a profit if at all possible, but they would do well to prioritize certain elements of the (re)design and not skimp in the wrong places. You make some excellent observations. I think there is (or was) a fad of “flippers” who saw a TLC episode or two and decided to make a go of it. There are also people who have no experience building new properties and find out the hard way that there’s more involved than they originally thought. Of course everyone has to start somewhere, I suppose.

We are looking at moving into a slightly larger place, and this past weekend we toured a duplex “built” by two people who owned some land and wanted to do something with it. Like you described in your post, these two people also made some mistakes in the selection of materials. The most glaring defects though were cosmetic issues with the finishing work: oversized holes in the sheetrock for electrical outlets (that the face plates don’t cover), poor spackling work, drywall nails that are quite visible with only paint to cover them, no Cat 5 cable pulled for a computer network, etc.

It’s understandable that anyone selling a property is looking to turn a profit if at all possible, but they would do well to prioritize certain elements of the (re)design and not skimp in the wrong places.

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