The Bird Dog Approach to Fix and Flip
Mar 31, 2018 / Fix and Flip
There are several different methods to making money in the fix and flip business. One of these methods is called the Bird Dog approach. It’s great for those who don’t have any cash on hand to purchase a property to renovate. You won’t make a huge amount of money with this approach. Most Bird Dog fix and flippers make a few thousand dollars per property. However, it’s a great way to get started, and you can save up that money to later start buying your own properties.
How Does It Work?
The Bird Dog approach only works if you have a fix and flip contractor to partner with. Basically, you find the property you want to renovate and flip, then contact a fix and flip contractor. They assume the contract to buy the house. When the contract to purchase the home is written, you will have the option to add what are known as “assigns.” This means you can assign the contract to a different buyer.
You’ll want to talk with your real estate professional to make certain this is possible in the state you’re in. Some states have specific rules regarding this method of buying property.
A Look at the Math
Let’s say you find a property that you could purchase for $100,000 and invest another $50,000 to fix it up. Once that’s done, you anticipate it will sell for $300,000. You find a contractor willing to assume the contract. You agree to buy the property for $100,000 but assign it to the contractor for $110,000. When the property sales after renovating it, the contractor receives the $300,000. So, you’ve made $10,000 from the contractor. The contractor paid out $160,000 to purchase the property, renovate it, and pay you, but they still made $140,000. Everyone goes home happy!
Why Be a Bird Dog?
Being a Bird Dog fix and flipper is a great way to get started in the industry. You don’t need any money, and you can learn a lot about how the entire process works. Many people see it as a type of on-the-job training. You might not get rich doing it, but you can definitely get started in the fix and flip industry.