Fix and Flip Property Business

Don’t kid yourself – fixing and flipping properties are a business. Actually almost a 24 hour…7 day a week business with many moving parts. We are currently running 4 projects. Each one has issues. One there is no electric. The last tenant ran up a bill of over £3,000. Actually was a cannabis farm and they totally destroyed the electric system. The electric company wants all kinds of documents from our solicitor to reinstall electric. Another property has front and back door issues. Another property was broken into over the weekend. Welcome to the world of property refurbishment and property flipping. We flip buy to lets and both Professional HMOs and Social HMOs. We do the refurbishement…tenant the properties…let them cash flow and stabilize…some we keep for our portfolio and some we sell on like Kevin Green suggests.

Treat refurb and flip as anything other than that and you will fail.  I’ve met a few so-called property investors in the past that operate their businesses like a hobby. They started out well enough.  But eventually running things fast and loose cost them everything. This is not a weekend warrior endeavor. Time is money. The sooner you finish the refurb and cash flow, the safer you will be.

Don’t run your business like a hobby, because hobbies are expensive.

Now, with that little disclaimer out of the way let’s get your fix and flip business started.  To begin, you’ll need to determine what your income goal is and then decide what exit strategy best suits your personality.

Have an Income Goal

It could be said that we average about $10,000 in profit per flip.  So if my goal is to earn $120,000 per year I need to flip 12 houses, one per month.  On average it takes about 90 days from acquisition to closing for a flip.  In order to close one deal a month I need enough working capital to have three houses on the books at a time. You dont want to stretch yourself thin. Always have enough liquidity and do not over leverage. BTW bridging is very expensive and you will find yourself in bed with your bridger if you do not act timely.