Don’t Get Emotionally Attached

I was just watching an episode of “Property Ladder” on the TLC Channel. An investor out of Houston, Texas bought a fixer upper for 175K, budgeted 30K for repairs and forecasted a sale of about 275K. Here’s is what not to do to avoid losing 20K in profits.

She made several novice real estate investor mistakes that cost her about $20K in potential profit. Now, don’t get me wrong she made about 50K in profit, but she could have made over 70K if it wasn’t for a few things that she should have done. When you are flipping houses as a real estate investment, keep the following in mind.

  • Line up your contractors ahead of time. Get references and speak to their past customers.
  • The rehab project is supposed to create the impression the house is expensive, not that it really is expensive because of over-priced appliances, high priced fixtures, etc.
  • Don’t become emotionally attached to the house. This is business,keep your personal taste out of it. Don’t let your taste dictate how the rehab is to be done. The local market sets the rule.
  • Her first rehab was a 175K house. I recommend you start a lot lower. Too much risk in a high priced home.

    • Good Luck.

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