I have done this in the past myself. If I could not flip at a nice profit right away, I kept it as a rental unit and sold later when I could turn a nice profit.

I advise young investors, like my daughter, to start out doing "owner occupied" investments. Buy a home that needs work, live in it 2 years while doing the repairs, then sell it and avoid tax on the profit.

Eventually, you get tired of this but doing it while you are young, before kids, etc. is the way to go.

Carmen and Jeff, where do you live? I am in the the Dallas, TX area.

http://RealtorThompson.com

Hello Jeff & Carmen,  This is certainly the time to look for deals.  I have recently changed strategies to buy homes in better schools zones.  I ususally renovate beyond the point of my personal comfort. Houses tend to run 40k or more higher than in other parts of town and I'm still looking for 20k or better in profit. I never figure commissions as part of the profit.  If comps are ok then it doesn't matter what part of town you buy in, but it may take a bit longer for resale.  If I foresee any problems reselling, then I opt to rent the property.  If I happen to find a lot somewhere my plan is to build a duplex, quad or something bigger that can be handicap accessible with the intention of marketing to retirees.  Good Luck, the slower market may also weed out some of the more infrequent investors.

Realtor, Columbus Ga

you are NOT CRAZY! There are deals out there nowadays that are just calling for someone to turn them into flips! I just wish I had the small flippers/investors I used to have who would do one to three homes a year ... but a lot of them are now either affraid or can't do the type of financing they would need to do. There isn't a day that I don't see something in the MLS that makes me regret that my husband needs to stick to long-haul trucking rather than flipping. But I would not take the risk of both of us being involved in real estate right now. And we are in our third home in just 4 years, so I don't think we've got much more energy to do anymore owner occupied flipping. Anytime I see one of the "flip this house"; "real deal" shows it makes me want to be there!

We just purchased our second house to flip. I do not live in these homes I buy them to fix and sell at profit. We did real good on our first one and this second one we managed to buy very good so I am excited about getting started. We do everything ourselves, exept for jamor things like central air which is happening right now so we can work in it this summer.

I am all for getting these properties back up to livable standards and most take around 15-20k to put back into shape. Very few houses on the market in this area have any "new" quality to them so adding new paint, new central air, new carpet etc. makes them a showpiece on the market and last one sold pretty quick so I am anxious just thinking about it.

It is a great thing to do and pays very well too. I recommend if you are slow right now in RE to do something like this.

If I were younger, I would most definitely be purchasing homes with flipping in mind. I would just remember that I might have to keep the home for a while before I can sell it.

I agree with Bill, you need to be ready to live in it or rent it out for a while.

Personally trading in real estate is the coolest thing we have the opportunity to do. I like land, though. We're closing on a property Monday, 36k profit in 2 years. The cash flow isn't there but if it's the right area, the appreciation sure is . . . .

Jeff,

Charleston is somewhat like Savannah, in that older homes on the periphery of growth are usually good buys to renovate and flip. What I have bought are older homes with the capability of enlarging the baths and kitchens. The one I am doing now is a duplex that had a butler's pantry off the kitchen. I tore down the wall to the butler's pantry and enlarged the kitchen, tiled the floor, replaced the appliances, put in wood plank ceilings.

Both units are 2 bedroom and 1 bath. The baths are small. Upstairs, where I enlarged the kitchen, I am taking out one bedroom and enlarging the bath and including a walk-in closet.

Downstairs I am doing mainly cosmetic work but leaving the layout as it is. The downstairs already had a larger kitchen - no butler's pantry.

The location is close to the popular downtown area, but the price per sq ft will be a third of downtown prices. I bought this place for 30% below market value.

My idea is to sell it to a someone who wants to live upstairs and rent downstairs to offset the mortgage.

1 bedroom, 1 bath condos downtown are selling for over $300,000. This is an inexpensive alternative for people who can't afford the mortgage on $300-400,000.

My investments before have been in more established areas, but from recent sales in this area, it looks like I will do well.

So, for me, right now, it is older homes on the periphery of growth, improved kitchens and baths, targeting buyers who want to live close to downtown but can't afford downtown prices.

I don't go overboard with the improvements, but I don't skimp when I think adding will bring a better return. I try to keep the old feel, while working with space to improve the modern desire for good kitchens, baths and closet space. The way these suckers are built, with all the weight being mainly on the outside walls, you can practically tear down all the walls without worry.