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(CNBC)   Couple makes $11,000 a month flipping real estate and all it took was his parents buying him his first house   (cnbc.com) divider line
    More: Asinine, Property, Renovation, Home improvement, Renting, Photography, Jamie McCauley, now-shuttered wedding photography business, Income  
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986 clicks; posted to Business » on 30 Nov 2022 at 8:30 PM (8 weeks ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook



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2022-11-30 6:59:12 PM  
I'll wager 11k a month being white helps
 
2022-11-30 7:35:37 PM  
WHY DO YOU HATE THE SELF-MADE MAN, SUBBY
 
2022-11-30 8:33:20 PM  
Fark user imageView Full Size
 
2022-11-30 8:42:00 PM  
There is no greater signal of an upcoming bear market in housing than articles about house flippers.
 
2022-11-30 8:51:02 PM  
$132k a year for a couple isn't exactly killing it. Seems like between all their gigs they spend way more than 2 hours a week.
 
2022-11-30 8:53:25 PM  
He lived there and managed the property during college, renting out rooms to seven other Cornerstone students to help pay his tuition.

Parents bought him a mansion.
 
2022-11-30 8:53:47 PM  
This is an ad.
 
2022-11-30 8:59:33 PM  
So far, they've bought three distressed properties, renovated them, stayed in them for a couple years and sold them at a profit before starting the whole process over again.
Their most recent renovated house sold for $436,000 in February, earning them $149,260 in profit, Jamie says
.

Of course it's not the market going up, it's their genius
 
2022-11-30 9:08:37 PM  

TedCruz'sCrazyDad: He lived there and managed the property during college, renting out rooms to seven other Cornerstone students to help pay his tuition.

Parents bought him a mansion.


Likely just a 4 bedroom, but still, the easiest way to get rich is to already be rich.
 
2022-11-30 9:19:35 PM  
But how much labor and materials did they spend to get that $11k a month?
 
2022-11-30 9:24:13 PM  

TedCruz'sCrazyDad: He lived there and managed the property during college, renting out rooms to seven other Cornerstone students to help pay his tuition.

Parents bought him a mansion.


I'm thinking duplex. That number is probably cumulative.

Duplex is actually a smart first home purchase. (not that they made the purchase themselves)
 
2022-11-30 9:25:43 PM  

EvilEgg: $132k a year for a couple isn't exactly killing it. Seems like between all their gigs they spend way more than 2 hours a week.


It says he works 30 hours a week. While the idea of having passive income is the dream for all of us it doesn't sound like it's entirely passive here.
 
2022-11-30 9:49:35 PM  
Oh no, someone's parents helped them get started in life.  The horror.

In other news, half of Fark seems to be living with their parents, mooching in the basement.
 
2022-11-30 9:55:42 PM  

TheYeti: Oh no, someone's parents helped them get started in life.  The horror.

In other news, half of Fark seems to be living with their parents, mooching in the basement.


We didn't invent the "born on third, thinks they hit a triple" meme.
 
2022-11-30 10:00:21 PM  
I mean, they needed 12 years to parlay that 4-room rental into a whopping 11 other rooms in 5 other properties, so it's not like they're breaking the market.  Plus they have a furniture restoration business, a wedding photo side-hustle (puttin' that fine arts degree to work!) and they renovate and flip distressed properties.  Admirable work ethic, but really it was the gifted 1st property that made it all possible, otherwise they'd be like me, waiting until I'm 45 before buying my first home (City rent, amirite?)
 
2022-11-30 10:01:01 PM  

EvilEgg: $132k a year for a couple isn't exactly killing it. Seems like between all their gigs they spend way more than 2 hours a week.


That's the trick.  I've gone through a dozen houses so far, some of them I've sold, some I've kept as rentals.  I have a full time job as well.

Last one we came in at $600k cash, plus about $50k in materials lived in it while we slowly rebuilt it, and sold at $1.2M inside 3 years.  That's a hard thing to do and it doesn't happen in 2 hours a week.

Honestly, I kinda miss that house.  Widescreen and a jetted tub in the master bath with enough room for a keggerator made for a good time watching hockey.

But as soon as the last piece of floor went in, the accountant wife said "I think it's time to call a realtor".

So we sold, and invested in another ugly duck at $900k buy in.  Currently we're blowing out the basement.  It'll cost $100k, but turn $500k in value inside a year.

Half the foundation is currently gone.  This 100 year old house is being held up by my wishes and good intentions.

Also, the bathroom from the last house:

photos.zillowstatic.comView Full Size
 
2022-11-30 10:24:45 PM  

rohar: EvilEgg: $132k a year for a couple isn't exactly killing it. Seems like between all their gigs they spend way more than 2 hours a week.

That's the trick.  I've gone through a dozen houses so far, some of them I've sold, some I've kept as rentals.  I have a full time job as well.

Last one we came in at $600k cash, plus about $50k in materials lived in it while we slowly rebuilt it, and sold at $1.2M inside 3 years.  That's a hard thing to do and it doesn't happen in 2 hours a week.

Honestly, I kinda miss that house.  Widescreen and a jetted tub in the master bath with enough room for a keggerator made for a good time watching hockey.

But as soon as the last piece of floor went in, the accountant wife said "I think it's time to call a realtor".

So we sold, and invested in another ugly duck at $900k buy in.  Currently we're blowing out the basement.  It'll cost $100k, but turn $500k in value inside a year.

Half the foundation is currently gone.  This 100 year old house is being held up by my wishes and good intentions.

Also, the bathroom from the last house:

[photos.zillowstatic.com image 850x572]


Wow.
You're not only an ass, but you have basic Home Depot taste. 

Neat.
 
2022-11-30 10:26:21 PM  
HEADLINE: Couple brings in $11k of income per month with only 2 hours of work!

STORY: Couple are given house by parents and subsequently spend several years living frugally and working long hours to get to a point where their income went up and they didn't need to work as much.

Journalism is dead.
 
2022-11-30 10:28:04 PM  

gunther_bumpass: rohar: EvilEgg: $132k a year for a couple isn't exactly killing it. Seems like between all their gigs they spend way more than 2 hours a week.

That's the trick.  I've gone through a dozen houses so far, some of them I've sold, some I've kept as rentals.  I have a full time job as well.

Last one we came in at $600k cash, plus about $50k in materials lived in it while we slowly rebuilt it, and sold at $1.2M inside 3 years.  That's a hard thing to do and it doesn't happen in 2 hours a week.

Honestly, I kinda miss that house.  Widescreen and a jetted tub in the master bath with enough room for a keggerator made for a good time watching hockey.

But as soon as the last piece of floor went in, the accountant wife said "I think it's time to call a realtor".

So we sold, and invested in another ugly duck at $900k buy in.  Currently we're blowing out the basement.  It'll cost $100k, but turn $500k in value inside a year.

Half the foundation is currently gone.  This 100 year old house is being held up by my wishes and good intentions.

Also, the bathroom from the last house:

[photos.zillowstatic.com image 850x572]

Wow.
You're not only an ass, but you have basic Home Depot taste. 

Neat.


I'm not an ass, I've just been doing this for a really long time.  Unlike those in the article, nobody gave me a house.  I busted my butt to afford the first one at like $150k.  I simply met the market with design and craftmanship.  Every home I've bought, I've done all of the work.

Truth is, the boring grey wasn't my ideal, but when rebuilding a house for possible resale, it's not about me, it's about the market.  And at that time, the market was demanding basic home depot shiat.

That made the sale.

Welcome to capitalism.  If it upsets you, stay out.
 
2022-11-30 10:34:01 PM  

BMFPitt: There is no greater signal of an upcoming bear market in housing than articles about house flippers.


Here! Here! 👏🏻
 
2022-11-30 10:42:18 PM  
Wanna bet they're farking over Uncle Sam on his cut?

There is no farking way they remain profitable without either slumlording or "The Government doesn't want you to know about this one weird trick!"

The trick is not declaring rental income andtaking the property tax and mortgage deductions.
 
2022-11-30 10:48:33 PM  
gunther_bumpass:

The truth is that I spend 40 hours a week at my real job dealing with data warehouses.  Then, unlike this headline, I spend another 20 to 40 hours working over a house.

If you put in the work it pays off, and you can invest in the next project.  We've been buying ugly duck houses in nice neighborhoods for 20 years, 20 years worth of that labor at that level of execution pays off.

Meanwhile, this was my week.  It used to be a finished basement, but the foundation was compromised.

100 year old house, and if I hadn't bought it, it'd fall over inside 10 years.

Am I really an asshole?

Fark user imageView Full Size
 
2022-11-30 11:00:45 PM  

rohar: Am I really an asshole?


Yeah. Anyone who brings specific money amounts unnecessarily into conversations about property or generally anything just to prove how skilled they are is always the asshole.
 
2022-11-30 11:04:54 PM  

gadian: rohar: Am I really an asshole?

Yeah. Anyone who brings specific money amounts unnecessarily into conversations about property or generally anything just to prove how skilled they are is always the asshole.


The article started with $11k per month at two hours a week.

My argument was simple, that's shiat income and they didn't do it in two hours a week.

If you'd like to know what it takes to make money in real estate, it's a solid 40 hours a week and if you make good decisions, you'll make much more.

And it's not about me, these numbers are common in the industry.

If that upsets you, feel free to find another industry.

Meanwhile, I'm going to finish rebuilding a house that families can live in for the next 100 years.  As assholish as that seems.
 
2022-11-30 11:07:52 PM  
No one is going to want that bathroom in 5 years, let alone a hundred, bro.
 
2022-11-30 11:08:50 PM  

gunther_bumpass: No one is going to want that bathroom in 5 years, let alone a hundred, bro.


Not my problem, I already sold it.  :)
 
2022-11-30 11:17:47 PM  

gunther_bumpass: No one is going to want that bathroom in 5 years, let alone a hundred, bro.


...and just for clarification, when I bought the house the subfloor in that bathroom was compromized to the point the previous tub was threatening to fall into the kitchen underneath if someone filled it.  The electrical was absurd, no GFI around all the water and completely out of code.  The drywall was full of mold, probably toxic.  And let's be real, carpet in a bathroom is just a bad idea.

This was an ugly duck in a semi expensive neighborhood, that's why I bought it.

If whoever bought it doesn't like the finishes later, good on them!  At least the house will still be standing.
 
2022-11-30 11:33:46 PM  

Autoerotic Defenestration: [Fark user image 500x617]


I read the TFA, so I know they didn't have one.
 
2022-11-30 11:36:21 PM  

kkinnison: But how much labor and materials did they spend to get that $11k a month?


Since they started from zero, and have no debt, nothing but a bit of labour really.

I was kinda wondering what angle people would go for, about a couple who doesn't really earn that much.

I'm just, good for them.
 
2022-11-30 11:38:49 PM  

baronbloodbath: Wanna bet they're farking over Uncle Sam on his cut?

There is no farking way they remain profitable without either slumlording or "The Government doesn't want you to know about this one weird trick!"

The trick is not declaring rental income andtaking the property tax and mortgage deductions.


I'd take that bet, about an article that makes no outrageous claims whatsoever.

"OMG, you can earn money renting stuff out. FAKE!!"
 
2022-11-30 11:39:30 PM  

gadian: rohar: Am I really an asshole?

Yeah. Anyone who brings specific money amounts unnecessarily into conversations about property or generally anything just to prove how skilled they are is always the asshole.


Would it be better if I left unsuspecting readers to believe that what the people in this article did was humanly possible?

Of course not.

If you want to churn this kind of income on residential property you've got two choices, spend a lot of money on multiple properties, or learn to do the work.

That's it.  Both suck balls some days.
 
2022-12-01 12:10:19 AM  
OH PUh-leese. Landlords and flippers are scum. Landlords are "The Market" in that they set the prices; yes people are 'dumb enough' to pay those prices, but raising rent is a form of collusion that both depends on and reinforces social power differentials. The fact that a lot of people are landlords makes them no less of a cartel. Adding insult to injury, they are the ones who have spare time and incentives to mess around with politics (guaranteed most local politicians are profiting off of real estate in some way) so we are pretty well stuck with their garbage system.

I don't know how to fix it other than encouraging people who can't afford to buy their own land to join housing cooperatives or land trusts and cut out the middlemen. Much of the societal power differential dates back to the original land grabs that built the US of A, with the valuable land going to families who had insider information about where the railroad depots would be built etc.
 
2022-12-01 12:18:43 AM  
I'm not saying nobody should fix up old houses, but if your profit relies on psychological tricks to make people think your 'improvements' to a structure are worth more than you paid for them, maybe... consider a different line of work. Yes it's cool you can scrape another 20 years out of a janky building, but we know how to build things so much more efficiently. Yet for some reason we have a housing stock of poorly-insulated old stick-built excuses for people to hand over big monthly checks to the fossil fuel industry.
 
2022-12-01 5:50:18 AM  

rohar: gunther_bumpass: rohar: EvilEgg: $132k a year for a couple isn't exactly killing it. Seems like between all their gigs they spend way more than 2 hours a week.

That's the trick.  I've gone through a dozen houses so far, some of them I've sold, some I've kept as rentals.  I have a full time job as well.

Last one we came in at $600k cash, plus about $50k in materials lived in it while we slowly rebuilt it, and sold at $1.2M inside 3 years.  That's a hard thing to do and it doesn't happen in 2 hours a week.

Honestly, I kinda miss that house.  Widescreen and a jetted tub in the master bath with enough room for a keggerator made for a good time watching hockey.

But as soon as the last piece of floor went in, the accountant wife said "I think it's time to call a realtor".

So we sold, and invested in another ugly duck at $900k buy in.  Currently we're blowing out the basement.  It'll cost $100k, but turn $500k in value inside a year.

Half the foundation is currently gone.  This 100 year old house is being held up by my wishes and good intentions.

Also, the bathroom from the last house:

[photos.zillowstatic.com image 850x572]

Wow.
You're not only an ass, but you have basic Home Depot taste. 

Neat.

I'm not an ass, I've just been doing this for a really long time.  Unlike those in the article, nobody gave me a house.  I busted my butt to afford the first one at like $150k.  I simply met the market with design and craftmanship.  Every home I've bought, I've done all of the work.

Truth is, the boring grey wasn't my ideal, but when rebuilding a house for possible resale, it's not about me, it's about the market.  And at that time, the market was demanding basic home depot shiat.

That made the sale.

Welcome to capitalism.  If it upsets you, stay out.


Gonna laugh when capitalism hands you a nice loss on the next one.  Expecting to get that type of value on your next property with everything going on in economy just proves it's better to be lucky than smart in capitalism.
 
2022-12-01 6:43:30 AM  

Meatsim1: So far, they've bought three distressed properties, renovated them, stayed in them for a couple years and sold them at a profit before starting the whole process over again.
Their most recent renovated house sold for $436,000 in February, earning them $149,260 in profit, Jamie says.

Of course it's not the market going up, it's their genius


$149,000.  Was that profit after subtracting the property taxes for three years, plus all renovations including by licensed electricians, plumbers, etc?
Did they received any cash after the realtors took their chunk, the moving company took theirs, and the bank took their fees on their new home loan?  I'm gonna guess maybe $100k cash in hand, but negative ROI.
 
2022-12-01 7:06:43 AM  

Northern: Meatsim1: So far, they've bought three distressed properties, renovated them, stayed in them for a couple years and sold them at a profit before starting the whole process over again.
Their most recent renovated house sold for $436,000 in February, earning them $149,260 in profit, Jamie says.

Of course it's not the market going up, it's their genius

$149,000.  Was that profit after subtracting the property taxes for three years, plus all renovations including by licensed electricians, plumbers, etc?
Did they received any cash after the realtors took their chunk, the moving company took theirs, and the bank took their fees on their new home loan?  I'm gonna guess maybe $100k cash in hand, but negative ROI.


Most of the flipping profits you see in these reality shoes only happen because the flippers are also licensed real estate brokers and are saving themselves 3% or more on the flip. But conveniently, cost of sales is never discussed on these shows, for good reason.

If you're not a broker, you need to increase a property's value by at least 6% just to break even, and I'm probably understating it due to several other hidden expenses related to the cost of sale.
 
2022-12-01 8:13:03 AM  

baronbloodbath: Wanna bet they're farking over Uncle Sam on his cut?

There is no farking way they remain profitable without either slumlording or "The Government doesn't want you to know about this one weird trick!"

The trick is not declaring rental income andtaking the property tax and mortgage deductions.


Seems to me that most of the money is from the tax free gains made from flipping their primary home(s) they live in for the minimum number of years, sell, repeat. This is not new. Or a trick. But does require being cool with that kind of churn in your life.

The rest is standard rental stuff. 11k a month is cool, but not insane. And there is no way they work 2 hours a week. If they even just left that BS brag out, it wouldn't have sounded quite so annoyingly exaggerated. While most is standard stuff, "facts" like that make everything subject to questioning.
 
2022-12-01 8:37:32 AM  

TheYeti: Oh no, someone's parents helped them get started in life.  The horror.

In other news, half of Fark seems to be living with their parents, mooching in the basement.


I have heard attics can be nice as well depending on the heat in the summer
 
2022-12-01 8:54:42 AM  

billinder33: Northern: Meatsim1: So far, they've bought three distressed properties, renovated them, stayed in them for a couple years and sold them at a profit before starting the whole process over again.
Their most recent renovated house sold for $436,000 in February, earning them $149,260 in profit, Jamie says.

Of course it's not the market going up, it's their genius

$149,000.  Was that profit after subtracting the property taxes for three years, plus all renovations including by licensed electricians, plumbers, etc?
Did they received any cash after the realtors took their chunk, the moving company took theirs, and the bank took their fees on their new home loan?  I'm gonna guess maybe $100k cash in hand, but negative ROI.

Most of the flipping profits you see in these reality shoes only happen because the flippers are also licensed real estate brokers and are saving themselves 3% or more on the flip. But conveniently, cost of sales is never discussed on these shows, for good reason.

If you're not a broker, you need to increase a property's value by at least 6% just to break even, and I'm probably understating it due to several other hidden expenses related to the cost of sale.


Just because that's the case on flip or flop does not make that the norm.  In fact, saving 3% is a ridiculous pittance.

People who flip houses are generally either contractors or people who grow up with contractors for fathers/brothers/cousins/friends and know how to do most of the work themselves.  (Obviously, there is some work where it's mandated by law to use a pro.).  It's super expensive work to fork all that over to professionals.  THAT'S what sucks down your money quick.

And then this article seems to go 'we bought a bunch of houses, waited a few years, and sold them as the market rose'.  That's not flipping houses.   That's just direct investing in real estate.  Which you can do... but requires already having a shiatload of money on hand and getting lucky there isn't a big economic downturn.  It's only an option for the rich to get richer.  (I suppose it might have been possible when interest rates were low to make that work with a mortgage, but definitely not now).  I'm guessing they got their '2 hours a week' because they maintained the property.  Cut the grass.  Paid the bills.  Etc.  Just keeping the properties somewhat nice.

/And for other houses... some are literal drab (especially smaller houses.  Contrary to what Fark seems to say, affordable houses are all over the place if you're ok with a small house.  But they're universally drab.  I have never once seen a nice looking smaller house) and require nothing more than cosmestic makeovers.  People are too lazy to do it themselves and will pay good money for it.  You won't make a ton for those, but it's not much time and effort either.
 
2022-12-01 9:10:42 AM  

DaMannimal: rohar: gunther_bumpass: rohar: EvilEgg: $132k a year for a couple isn't exactly killing it. Seems like between all their gigs they spend way more than 2 hours a week.

That's the trick.  I've gone through a dozen houses so far, some of them I've sold, some I've kept as rentals.  I have a full time job as well.

Last one we came in at $600k cash, plus about $50k in materials lived in it while we slowly rebuilt it, and sold at $1.2M inside 3 years.  That's a hard thing to do and it doesn't happen in 2 hours a week.

Honestly, I kinda miss that house.  Widescreen and a jetted tub in the master bath with enough room for a keggerator made for a good time watching hockey.

But as soon as the last piece of floor went in, the accountant wife said "I think it's time to call a realtor".

So we sold, and invested in another ugly duck at $900k buy in.  Currently we're blowing out the basement.  It'll cost $100k, but turn $500k in value inside a year.

Half the foundation is currently gone.  This 100 year old house is being held up by my wishes and good intentions.

Also, the bathroom from the last house:

[photos.zillowstatic.com image 850x572]

Wow.
You're not only an ass, but you have basic Home Depot taste. 

Neat.

I'm not an ass, I've just been doing this for a really long time.  Unlike those in the article, nobody gave me a house.  I busted my butt to afford the first one at like $150k.  I simply met the market with design and craftmanship.  Every home I've bought, I've done all of the work.

Truth is, the boring grey wasn't my ideal, but when rebuilding a house for possible resale, it's not about me, it's about the market.  And at that time, the market was demanding basic home depot shiat.

That made the sale.

Welcome to capitalism.  If it upsets you, stay out.

Gonna laugh when capitalism hands you a nice loss on the next one.  Expecting to get that type of value on your next property with everything going on in economy just proves it's better to be lucky than smart in ...


Worst case, I'll continue living in it.
 
2022-12-01 9:37:06 AM  

TedCruz'sCrazyDad: He lived there and managed the property during college, renting out rooms to seven other Cornerstone students to help pay his tuition.

Parents bought him a mansion.


Maybe, but I had a friend in college who rented out a couple of condemned houses right by a major University compass.  Since it was already illegal to rent out anyway, he basically ran a flop house, and stuffed about 15 kids in to each one, and then rented out the basement to a dozen illegal immigrants.  Now, those properties are 15 story apartment complexes.
 
2022-12-01 10:00:01 AM  

Northern: Meatsim1: So far, they've bought three distressed properties, renovated them, stayed in them for a couple years and sold them at a profit before starting the whole process over again.
Their most recent renovated house sold for $436,000 in February, earning them $149,260 in profit, Jamie says.

Of course it's not the market going up, it's their genius

$149,000.  Was that profit after subtracting the property taxes for three years, plus all renovations including by licensed electricians, plumbers, etc?
Did they received any cash after the realtors took their chunk, the moving company took theirs, and the bank took their fees on their new home loan?  I'm gonna guess maybe $100k cash in hand, but negative ROI.


If you're going to calculate it that way, you'd also need to credit what you would pay in rent, since that would be a cost they're saving.
 
2022-12-01 10:03:37 AM  
Please stop greenlighting these.
 
2022-12-01 10:34:32 AM  

TedCruz'sCrazyDad: He lived there and managed the property during college, renting out rooms to seven other Cornerstone students to help pay his tuition.

Parents bought him a mansion.


While you share the spare room with Nana's doll collection. We get it.
 
2022-12-01 10:59:16 AM  
"When Jamie McCauley was a junior at Cornerstone University, his parents bought and helped him renovate a foreclosed home near the Grand Rapids, Michigan campus.

He lived there and managed the property during college, renting out rooms to seven other Cornerstone students to help pay his tuition. He met his wife, Sarah McCauley, in that house, too."


When I was a stupident in the early 80s I drove a girl from class back to her crib.  She was living in a new townhouse off campus.   I commented that it was a nice place and she replied that her parents owned it.   I assumed that she was living at home with her family when she told me her parents bought the place so she and her sister could live there while they were going to school.   It was two bedrooms, this girl and her sister shared one bedroom and they had two female roommates who shared the second bedroom.  The rent from the roommates helped hold down costs but the townhouse was in an area where property values were increasing.  I'm sure the parents made a nice profit on the flip.

Of course to do something like the above you need cash or very good credit, something that poors don't have.   Poor kids go to school and get saddled with monster debt, rich kids go to school and their parents make a profit.  It's the Murican way.
 
2022-12-01 11:59:51 AM  

DecemberNitro: Please stop greenlighting these.


Real news has paywalls and Farkers are brokies.
 
2022-12-01 12:26:27 PM  

Fissile: "When Jamie McCauley was a junior at Cornerstone University, his parents bought and helped him renovate a foreclosed home near the Grand Rapids, Michigan campus.

He lived there and managed the property during college, renting out rooms to seven other Cornerstone students to help pay his tuition. He met his wife, Sarah McCauley, in that house, too."

When I was a stupident in the early 80s I drove a girl from class back to her crib.  She was living in a new townhouse off campus.   I commented that it was a nice place and she replied that her parents owned it.   I assumed that she was living at home with her family when she told me her parents bought the place so she and her sister could live there while they were going to school.   It was two bedrooms, this girl and her sister shared one bedroom and they had two female roommates who shared the second bedroom.  The rent from the roommates helped hold down costs but the townhouse was in an area where property values were increasing.  I'm sure the parents made a nice profit on the flip.

Of course to do something like the above you need cash or very good credit, something that poors don't have.   Poor kids go to school and get saddled with monster debt, rich kids go to school and their parents make a profit.  It's the Murican way.


Rich Parents Make Their Child Rich Too. Full Story At 11.
 
2022-12-01 1:20:47 PM  

jake3988: billinder33: Northern: Meatsim1: So far, they've bought three distressed properties, renovated them, stayed in them for a couple years and sold them at a profit before starting the whole process over again.
Their most recent renovated house sold for $436,000 in February, earning them $149,260 in profit, Jamie says.

Of course it's not the market going up, it's their genius

$149,000.  Was that profit after subtracting the property taxes for three years, plus all renovations including by licensed electricians, plumbers, etc?
Did they received any cash after the realtors took their chunk, the moving company took theirs, and the bank took their fees on their new home loan?  I'm gonna guess maybe $100k cash in hand, but negative ROI.

Most of the flipping profits you see in these reality shoes only happen because the flippers are also licensed real estate brokers and are saving themselves 3% or more on the flip. But conveniently, cost of sales is never discussed on these shows, for good reason.

If you're not a broker, you need to increase a property's value by at least 6% just to break even, and I'm probably understating it due to several other hidden expenses related to the cost of sale.

Just because that's the case on flip or flop does not make that the norm.  In fact, saving 3% is a ridiculous pittance.

People who flip houses are generally either contractors or people who grow up with contractors for fathers/brothers/cousins/friends and know how to do most of the work themselves.  (Obviously, there is some work where it's mandated by law to use a pro.).  It's super expensive work to fork all that over to professionals.  THAT'S what sucks down your money quick.


Exactly, 2% is nothing on a 30% profit.  Of course, you only hit that profit if you're the labor.
 
2022-12-01 3:48:30 PM  
The funny thing about flippers is that when the homeowner dies, the kids clean it out and sell it.  
The flipper buys it, and up rolls the dumpster.  
Now the house is gutted, and the loads of tile arrive.  
Then a few months later, it's back on the market.  
Someone buys it, the dumpster arrives, and they tear out all the crap the flipper put in.  
 
Totally sustainable.
 
2022-12-01 4:53:01 PM  

gunther_bumpass: The funny thing about flippers is that when the homeowner dies, the kids clean it out and sell it.  
The flipper buys it, and up rolls the dumpster.  
Now the house is gutted, and the loads of tile arrive.  
Then a few months later, it's back on the market.  
Someone buys it, the dumpster arrives, and they tear out all the crap the flipper put in.  

Totally sustainable.


You seem really upset that people buy houses on the brink of destruction who sort them out and make them habitable again.

Is there a reason for that?  

Where did the guy with the nail gun hurt you?
 
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