My wife is planning to become a travel nurse and move every 3 months to a new city. I am looking into the possiblity of rehabbing houses in each individual market we live in. I have some experience in the business but I am looking for some advice. Is it possible to rehab 4 houses a year in 3 completely different markets? what will my biggest challenges be? How can it be done? thanks
No, unless it’s truly a “cosmetic” rehab, meaning there’s not much wrong with the property at all. Every real estate market is regional, meaning that each city you go will likely be at a different point in the real estate cycle. There simply isn’t a large enough window to research the market, find the deal in the first place, close on it, rehab it, and then sell it.
Your best bet is to “flip” the property, and I mean the true definition of “flipping”, which means you find a property and quickly locate an investment buyer for it. Ideally you wouldn’t even have to take the property into your own name, avoiding transaction costs and any potential tax ramifications. If you find a great deal on a rehab property tie it up by putting as little earnest money down as possible, and set the closing date as far out as possible. In the meantime use the yellow pages or whatever other means you have available to find an investor willing to buy your property at a marked up price.
The potential downfall, obviously, is that you cannot find someone interested in taking the property from you and you’ll either have to purchase it yourself or lose the earnest money (which is why you want to put down as little as possible).
Make sure you have the ideal business entity (S-corporation or LLC taxed as an S-corp) set up to gain the most favorable tax treatment.