Buying a home, renovating it, and reselling it can be a hit or a miss. If it's the latter, you best be prepared for a financial hit.
But that's not preventing people from flipping houses. American homeowners flipped 217,000 single-family homes or condos in 2017, the most in 11 years, reported Ronda Kaysen of The New York Times , citing real estate data company ATTOM Data Solutions .
But flipping houses isn't as easy as reality TV makes it out to be or as quick. We talked to several people who have been through the process of flipping a house more than once, and many said the real-life timeline of house flipping is longer than depicted. The consensus? You need to be prepared for unforeseen circumstances, especially going over budget.
You're also bound to learn the hard way from mistakes. One house flipper spent a grueling amount of time scraping wallpaper off her kitchen, while another didn't check how laminate flooring fit together before purchasing it, resulting in complications when it came to laying it down.
And then there's the housing market. Sometimes, a flipped house will take longer to sell or won't sell for as much as you anticipated, decreasing your profit.
But that's not to say house flipping can't be rewarding or a good investment especially if you love doing it.
Here's what house flipping is really like, according to house flippers themselves.
House flipping involves buying an investment home, renovating it, and reselling it quickly to make a profit.
You can make serious money if all goes well, but its not a surefire way to get rich. There are a lot of details to house flipping that can get overlooked.
In fact, house flipping isnt what HGTV makes it out to be. Heres what its really like, according to those whove done it.
From lenders and investors to lawyers and contractors, its a high-cost business, house flipper Justin Pierce said in an article in The Washington Post. This leaves things out of your control. "You feel pretty helpless when a contractor messes up your project and walks away," Pierce, whos based in Virginia, said.
Pierce called it "knowledge-intensive," saying its best if you have knowledge in real estate market specifics, real estate and business law, insurance, contracting, negotiations, and project management.
Its also high-risk with low margins. "The biggest risks are in valuing the property, determining the renovations, and managing the construction," Pierce wrote.
Pierce also said its time-consuming and hard to delegate and scale. "At least half of the work of flipping a house is finding the house in the first place," he said. "Once you find the deal, you have to line up funding, develop a scope of work and get contractors bids."
When Cassandra Monroe and her mother and brother inherited a home in Iowa, she didnt know what to do with it at first.
"It definitely needed cosmetic work and some serious tender, love, and care," she told home magazine Domino.
The kitchen was small and was "dated brown," according to Monroe. She wanted to open up the space with an all white, grey, and stainless steel palette.
The first step was scraping off the dated wallpaper.
"Scraping off that stubborn wallpaper (to expose the patterned off-white walls) and tearing off that paneling was so satisfying," Monroe told Business Insider.
The walls were finally replastered and painted. At this point, Monroe started washing and sanding the cabinetry to prepare painting them.
She spent many days and nights painting and refinishing the kitchen cabinets.
"The hardest part of the process was being patient with the work and how long and laborious it was," she said.
"There were some days when we were honestly burned out and didnt even want to look at the home so we took our days off when we needed to get a fresh mind before working again," she said.
But the hard work was worth it the kitchen transformation ended up being one of her favorite parts.
Shes also really proud of the bathroom transformation, pictured here at the beginning of demolition.
"We knew from the beginning that we wanted to completely gut the bathroom and start over fresh, so we wanted to get it torn apart as quickly as possible so we could start working on it," Monroe said.
But it was a process. "What a difference tearing down the shower area and cabinets made already!" she said. "Still, more needed to be done to get this bathroom where we wanted it."
"With the bathroom renovation, I wanted to demonstrate that a small bathroom can transform (in this case, the only bathroom in the house) into looking and feeling larger with lighter paint colors and strategic storage," Monroe said.
Courtesy of Cassandra Monroe
"Occasionally I would get this feeling of Is this ever going to be done?" she wrote. There were days where we were wondering if we would see the light at the end of the tunnel for this project since there was still so much to do." She began to see progress at the halfway point.
Courtesy of Cassandra Monroe
"The easiest part of the process was realizing exactly how I wanted to update the home cosmetically," she wrote.
Courtesy of Cassandra Monroe
But sometimes it was difficult to figure out what to do with certain spaces, she said. Monroe wanted to turn this closet into a bookshelf, but didnt know what to do with the wood on the bottom.
The most challenging part of the renovation for Monroe was sticking to a timeline and budget. Instead of finishing the project in their desired six months, it took 10. They also went over their budget by $3,000.
They tried to do as much as the could by themselves to save costs, including taking apart parts of the home, painting everything, and purchasing 95% of the materials.
"There are always unforeseen circumstances that come up though, which is why I didnt get too hard on myself when we went past our timeline," she said.
"I will say that in my personal experience, the timeline goals are definitely different in real life compared to what you see on the home design or flipping shows," she wrote. "Our crew consisted of four people, including the contractor."
Tania Griffis also realized that projects often take longer than anticipated. She and her husband have flipped five houses in Dallas, Texas, in the past nine years while living in them.
Instead of the proposed two months, this kitchen took more than six months to finish. "It was mainly small details that you would never think of that took so long grout, sealing, trim work, etc.," Griffis told Business Insider. "The unsexy things they dont show on TV...real life is not like HGTV!"
"We always tell people to triple the time they think it will cost and double the amount you think you will spend," Griffis added. "Be prepared!"
Courtesy of Tania Griffis
Another kitchen remodel she worked on had several issues narrowness, poor lighting, lack of counter space, and a non-functional pantry.
"Demoing a kitchen is a lot harder than it looks on TV," Griffis wrote in her blog, Run to Radiance. "Tile and drywall and cabinets are all pretty tough materials."
They had no energy to jackhammer out the tile floor, so they hired a crew, who removed the flooring in less than a day. When Griffis and her husband removed it themselves in their last house, it took weeks.
They also hired workers to install the tile to make things easier.
But after all the work, it ended up being her favorite kitchen remodel to date.
Another kitchen had a few low points. "It was extremely small there were only a few feet for prep work (literally)," Griffis said. "The cabinets were also old and falling apart."
They replaced the cabinets with pre-painted Home Depot base models, extended the kitchen by several feet, brought in stainless steel appliances ("steel sells," Griffis said), and added affordable granite countertops.
And then there was the kitchen in her fifth flip, which had dark cabinets, cracked windows, popcorn ceilings, and outdated appliances.
It also had a funky layout; after coming up with several floor plans, they opened up the kitchen to the living room.
This was after they asked the contractor to do work for layout options they later discarded like taking down the upper cabinets for open shelving. The cabinets later came back up after Griffis felt it looked lopsided.
They also didnt have the budget for in-ground piping and electric, so they had to keep two columns on either side of the island to run electric and gas pipes.
And they couldnt afford to replace the greasy and dirty cabinets, so Griffis went with Plan B: Painting them white.
Sometimes, you have to learn how to do things yourself and get creative. Griffis husband taught himself plumbing when remodeling this bathroom. They moved a single small sink to replace a "super long, weird counter area," she said.
They then made the sink a double and turned the area where the old sink was into a closet, which Griffis said was ideal since its a master suite.
She also had to get creative in a different bathroom, where she wanted a bigger tub. "It was tiny and gross. Stained all over and the fixtures were kind of ridiculous," she wrote on her blog.
She also wanted more space and different flooring because the tiles were damaged, cracked, and uneven, she wrote.
"Thankfully, enlarging an existing shower is not as hard as you would think just take space from an adjoining room," Griffis wrote. They ended up taking space from a hall closet.
They had the shower door removed and the tub replaced and re-tiled. "We had basic shower fixtures, but I teamed up with a company to replace them and add higher-end gold ones," Griffis said.
Courtesy of Tania Graffis
Some rooms need more work than others. In one master bedroom, it took Griffis about 12 hours to remove the border strip along the top of the walls.
"We learned from our mistake and with the rest of the home just re-textured right over the wallpaper," she said. "I would only recommend that if the wallpaper is as impossible to get off as this one was!"
They also had a particular challenge with one living room when they purchased laminate flooring without trying to put a few pieces together in the store.
By the time they realized how difficult it was going to be, they were under a tight timeframe and couldnt return the laminate. It took them five times as long to put together as another floor would have.
The underlayment also didnt go as planned. Griffis got a package deal with free underlayment, but it wasnt high quality.
"It tore and ripped constantly if you stood on it the wrong way or if you had to crawl on your hands and knees (which you are doing 90% of the time!)," she wrote. "We were able to patch the holes with duct tape but it was a pain in the rear for sure."
One thing that did go well was whitewashing the fireplace bricks. "I think this has been the cheapest, easiest high impact project we have done yet!" she wrote.
They made the whitewash mix out of equal parts paint and water.
Griffis said theyve learned a lot from their mistakes and years of experience. "My best advice if someone wants to be successful with a flip, find someone with experience and pay them for their expertise. Its absolutely the best investment you can make!" she said.
"You always have to find a balance when flipping between budget, comps, style, and practicality, particularly when you are living in a home while doing the work," she said. "Keep in mind the goal (and plan for extra money and time!)."
Griffis also learned the hard way that homes can sit on the market longer than expected this home was the only flip Griffis did that didnt get multiple offers on day one.
"We werent prepared for that, and the three weeks we waited felt like an eternity," she said.
Carl, who has flipped five homes in Colorado, bringing in over $400,000 in profit (the foundation for what later became a $1.2 million nest egg), also dealt with market problems.
He hoped to sell a flip he bought for $535,000 in 2006 for $1 million, but it only sold for $725,000 because of the Great Recession, he told Business Insider. He spent at least 2,000 hours working on the home with no financial gain.
"Luxury homes were hit hardest and ours was no exception," he said. "From this flip, we learned that changing economic conditions can derail the best-laid plans."
Its especially troubling considering the serious problem he dealt with while renovating he removed the roof off to build a second level, but a severe windstorm blew the tarps off the structure.
"In an effort to save the hardwood floors, the Mrs. and I ran around with buckets, plastic totes, and pots to catch the water," he said. "We ended up saving the floors, but we had to replace much of the sheetrock and electrical fixtures."
He flipped another home in 2013. "When we bought this home, it was a sad foreclosure that had seen better days," he said. "The home was infested with ants and the siding was falling off. It was a home only a flipper could love."
They hit a roadblock when applying for a permit they learned an addition was put on the home without approval and violated setback ordinances. "Luckily, the city inspector didnt make us tear it down, but we had to rebuild parts of it because it had not been constructed to code," he said.
He balanced remodeling the home with a full-time job, so it took him five years to complete. However, the time spent paid off the house, purchased for $175,000, is now worth $550,000 (hes currently living in it and has yet to sell).
"If I could do it over again, I would have waited until I retired to work on this house," he said.
Liz and Jason Haynsworth have flipped more than 10 homes. They run Haynsworth Custom Homes in Dallas, Texas, and have renovated roughly 20 properties and built half a dozen homes from the ground up, Liz told Business Insider.
According to Liz, their two biggest challenges with flipping houses are streamlining the schedule and getting the floor plan just right.
"Weve found that it pays to reimagine the floor plan for todays buyers because homes that were built decades ago simply lack the features that a modern buyer expects," she said. "Even with the most beautiful finish-out, a home with a terrible floor plan will just sit on the market."
Their second flip, she said, contained a kitchen, breakfast nook, living room, and covered patio that were "choppy, outdated, and not very livable." They needed help in the floor plan department.
"Combining them required a lot of imagination and engineering and a vaulted ceiling," she said.
Their tenth flip, a typical 50s ranch, also needed floor plan help it was outdated with small rooms.
"Many long nights were spent at this house, puzzling out how best to use its existing square footage," she said.
They ended up keeping the original footprint of the home, but added a laundry room and powder bath.
They also rejiggered existing rooms, transforming the hall bathroom into a master bath and the formal dining room into a fourth bedroom. The remaining rooms were opened up...
...like the living room.
But the creativity and hard work involved is just an example of how rewarding a successful house flip can be in the end a young family bought the house before it even hit the market.
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