Fix & Flip Business Revenue Streams
Oct 30, 2017 / Revenue Tips
The fix-and-flip business offers a few different sources to earn revenue - our primary focus is on buying, fixing and selling homes because this is where the big money is at, leading to the freedom and lifestyle you desire.
If you don't have the cash and or confidence to get started with your first fix-and-flip, there is always the "Birddog / Wholesaler" route, which takes zero cash, zero credit, and you can earn $3,000.00 to $7,500.00 or more per deal!
Bird Dog / Wholesaler
The bird dog / wholesaler finds fix-and-flip properties and presents them to fix-and-flip contractors. You bring the deal and the fix-and-flip contractor essentially assumes your contract to purchase the home. When you write a contract on the home it would be in your name "and or assigns" which gives you the opportunity to assign the contract to a new buyer prior to closing.
As an example, you agree to purchase a home for $185,000.00 (you, through your express evaluation have determined the ARV (After Repair Value) to be $325,000.00 with 50k in fix-up costs) and agree to assign that contract to a fix-and-flip contractor for $193,000.00, netting you $8,000.00, and leaving a healthy potential profit for the fix-and-flip contractor.
Fix and Flip
Becoming a fix-and-flip contractor is where you ultimately want to be – the goal is to tap into this large revenue stream, and not settle for a small piece of a deal. Now I always say "a piece of something is better than all of nothing", but work towards that largest piece.
Our goal is not to make more, and more, and more money, to support our increasing expenses. The goal should be to get to the point… where you don't have to work anymore – period!
Some of the richest people I know have made their money in real estate, and a majority of them have accumulated properties over the years – why wouldn't you, this is your business, it is your area of expertise.
When you run into that deal (which you do once every year or two) that is really great, really under value, maybe you consider a "rental renovation" (less than a total gut and remodel), refinance the property, rent it out and hold.
The Denver market where I have worked since 1991 has went up every year since – in the core of the city we didn't even lose value during the great recession of 2008. Things were flat for a bit, but nothing lost value, and since that time housing in Denver is up probably 50%!
Start accumulating properties – I love to be able to drive by my brick and mortar investments and see those rent checks auto-deposited into my account each month… other people building equity, for me.
Jeff Hammerberg is a Real Estate Professional / Fix and Flip Contractor and President of FixAndFlip.com - The Nation's #1 Source for tips, products and education geared toward ensuring your success in the fix-and-flip business.