real estate
On reality TV, flipping houses seems like a surefire way to make a ton of money, but is flipping houses really the route to riches? Read on to find out how much real people are making from flipping houses.
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Can you really make a ton of money flipping a house? It sounds appealing, but it's also risky. Flipping a house means buying a home that needs repairs and selling it quickly for a profit, but it can easily backfire if you're not careful. Before you get into real estate investing, learn the real story from these 10 house fliers.
Revenue: Not Enough
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Rob Berger has only ever renovated one home, so his vow to “never renovate again” may seem a bit premature. But his DIY experience has given him some hard-earned insight into this much-discussed trend. His top advice? “Turn off HGTV.”
Revenue: $20,000
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CPA Logan Allec found his first resale property by relying on “old-fashioned direct mail marketing” — sending letters and postcards to absentee landlords in his target market. Online, bargains sell fast, so you'll need to be creative to close the deal. To see a solid ROI, you'll need to be willing to spend time and money.
Revenue: $117,000
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Adela Mizrachi emphasizes the importance of having a knowledgeable partner when flipping homes. Luckily for her, Adela's business partner is her boyfriend, John, who is a licensed real estate agent. She has flipped two homes so far and advises beginners to give themselves “double time” to the entire process.
Revenue: $114,900
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Colorado CEO Brian Ludlow is a born businessman whose profession helps him make money. He uses his website to generate leads for real estate and to sell properties that are “worth more.” [are] “It's skyrocketing.” Using this strategy, he made $114,900 on a single home in Colorado Springs.
Revenue: $151,600
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A common theme in successful home flipping is in-depth real estate knowledge. Such is the case with professional home buyer and agent Urijah Dortch. His biggest success was a property in Raleigh, North Carolina. The home was in “terrible condition” and required $126,400 in renovations on top of the $72,000 purchase price. And yet he made a handsome profit.
Earnings: $400,000 from 5 flips
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Carl, a Colorado home flipper, said he ultimately saved enough money that he spent “at least 2,000 hours” on the renovations with “no financial gain.” As Carl learned from his experience flipping homes during the Great Recession, some factors are outside of flippers' control: Changing economic conditions can “undo the most carefully laid plans.”
Revenue: “Reasonable revenue…”
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“…but after the months of work and the financial risk, it just wasn't worth it,” is how SL Brown sums up her home flipping experience. Though she and her husband ultimately reached their target price, the return on their investment wasn't great enough to justify the stress the renovations caused the couple, who also worked full-time jobs as lawyers.
Related: America's most popular home improvement projects
Revenue: $27,936.90
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Melissa, a self-proclaimed “DIY junkie” and real estate agent in North Atlanta, embarked on her first property flipping adventure as a young professional with debt. The result? “Enough money to pay off my car, three credit cards with balances, put some money toward my student loans, and put some cash aside for savings.”
Revenue: Approximately $30,000 per resale
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Home flipper Mark Ferguson acknowledges that profits and losses can vary widely from property to property. He has flipped more than 155 homes, making an average profit of $30,000 per home. “Once you develop a system and learn the business, you can make a lot of money,” he says.
Related: 12 Hidden Costs of Selling a Home