In 1990, Seán Conlon came to America from Ireland with only $500.
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A real estate developer says the biggest house-flipping mistake he sees doesn't have anything to do with the houses themselves
Seán Conlon from "The Deed: Chicago" explains where rookies go wrong when they start flipping
Sean Conlon the deed real estate
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Supporting himself by working as a janitor, he eventually cold-called his way to a career in real estate.
Today, the real estate developer, lender, and broker stars in "The Deed: Chicago," which premiers March 29 on CNBC. The series focuses on Conlon helping people salvage their failing flips.
Conlon spoke with Business Insider about one of the biggest mistakes he sees rookie house-flippers make.
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Surprisingly, it doesn't have much to do with the houses themselves. It's about who you choose to work with.
"You have to so carefully pick your partner," Conlon says. "It's the same as picking a wife or a husband. The greatest risk I've ever faced in business is there were crisis situations where my partners and I were not aligned."
He likened taking on a house-flipping partner to sharing a lifeboat with another person.
"If they're not rowing with you, they're rowing against you," he says. "If you're in a fight with your partner, you're sitting in a lifeboat and they're trying to stab you in the back. You're both in the same boat — you'll go down together."
It's a lesson that Conlon learned the hard way. He estimates that he's picked four to six bad partners in his life. His advice for newcomers to the real estate? Pick a partner with a life situation that's similar to yours. Also, make sure you both have skin in the game.
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"If you do a flip and your friend is your partner and they're bringing their creativity but you put up all the money, you'd be shocked by how quickly they become less worried about it than you when the thing catches fire," he says. "They don't really have money or skin in the game. It's so much better to have an uncomfortable conversation up front than to try to deal with it when your house is on fire. Skin in the game is so important."
Lastly, if you do end up in a dysfunctional partnership, don't get fooled twice.
"There's very little to be learned from the second kick from a mule," Conlon says.
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