House flipping: it’s harder than it looks

Reality of the business can be much more stressful than it seems on TV

New York /
Jun.June 15, 2018 11:23 AM

(Credit: iStock)

Prospective house flippers,  be warned: the reality of the business is much tougher than it appears on reality television.

The popularity of buying properties to renovate and sell at a profit is steadily increasing,  and many people in the industry credit this to reality shows about the practice on networks like HGTV, according to the New York Times. In the New York area, flips made up 5.6 percent of sales in 2017, a 29 percent increase from 2016, and throughout the country, Americans flipped 207,000 condos or single-family homes, the highest number in 11 years.

But when people actually start doing it themselves, they can find it extremely difficult to make a sizable profit and get the house ready to sell.

Joshua Levitt and Graham Blundell, for instance, entered the house flipping market in 2015 and were able to make an $80,000 profit selling a house in South Orange, New Jersey. However, their next purchase of a four-bedroom home in nearby Bloomfield was much more challenging. Thanks to transaction fees and financing costs, they only made a $20,000 profit off of it.

“You could spend four weeks with an architect before you even get started,” Levitt said to the Times. “Then you have to pull permits, and that can take another month.” [NYT] – Eddie Small


Related Articles

arrow_forward_ios
A photo illustration of Gainesville Mayor Harvey Ward and Gainesville, Florida (Getty, Harvey Ward)
NIMBYs triumph in Florida upzoning battle
NIMBYs triumph in Florida upzoning battle
25 Cactus, Irvine, CA and Albert Pujols
Albert Pujols lists Irvine mansion for $10M
Albert Pujols lists Irvine mansion for $10M
Fromk left: Mauricio Umansky, Christian Ulbrich, and Scott Rechler
They said what now? Real estate quotes of the week
They said what now? Real estate quotes of the week
RXR's Scott Rechler, Tamir Shemesh, Richard Meruelo, and Maria Meruelo (Getty, Serhant, Coldwell Banker)
Breakups, layoffs and walkaways: No love in real estate last week
Breakups, layoffs and walkaways: No love in real estate last week
Connecticut proposal would convert empty box stores into housing
Connecticut proposal would convert empty box stores into housing
Connecticut proposal would convert empty box stores into housing
(Photo Illustration by The Real Deal with Getty Images)
The housing correction is a tale of two markets
The housing correction is a tale of two markets
A photo illustration of Manhattan Borough President Mark Levine (Getty, Office of Mark Levine)
Map: Here’s a treasure trove of Manhattan resi development sites
Map: Here’s a treasure trove of Manhattan resi development sites
Albany buildings
How Albany is dealing with its 1K vacant buildings
How Albany is dealing with its 1K vacant buildings
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...