This is driving me crazy!

Am I nuts for thinking I should be able make $20k on every deal?

Let me clarify what I mean by “make $20k”. I am talking about a “take home paycheck” of $20k (with the income taxes and Self Employment taxes taken out and put aside in another account for end of year taxes)

I have not done a deal yet, am just getting started looking seriously and I am wondering if I have too inflated of an idea of what I can make. Should I be aiming for $20k BEFORE income/SE tax? That would give me a “paycheck” of around $11340

It seems that when I do the 70% less repairs formula for buying, I get a “take home paycheck” of about $20k. I am pretty confused. I am just not sure what is possible.

I don’t want to be greedy but I do want to make sure I am not taking on weak deals

I wouldn’t spend a lot of time passing up good deals waiting for one with a take home check of $20,000. If you can make $11,334 on a bunch of deals, that might be OK too!


I think he is wondering, if thats very possible… or if its pie in the sky, I don’t know or I would say!


Yes, it’s possible to make $20,000 “take home” per deal. It is also possible to make $500,000 per deal “take home”, doing bigger deals of course.


The formula I used had us making $20,000 per rehab. Then I actually started doing it and realized that in the market I am in I had to adjust my formula. We are making $12,000-15,000 per flip now. Yeah, I’m okay with that! :beer

I guess if you make 10k clear your doing ok :slight_smile:

Right! And if you clear $10K per and do 12 flips this year and 20-25 next year… you do the math!

you have to really put this in the context of what is the property, how much work/effort are you putting into it and how much risk are you taking. If you’re doing <$100k houses that require carpet, paint and some bath/kitchen work, then that’s pretty good. If you’re doing a 3000 sq ft house and really blowin’ it out, then you need to be making much more than $20k

Yes of course, I was just saying on the easier stuff 10k is good… I wouldn’t do a hugeeeeeeeeeeee house and only make 10k that would be dumb!

Right aak… all of our houses are under 100K. Our last one we purchased at 45K, rehab/holding/closing costs 7K, sold for 67K.

Thanks for your replies everyone!

Great point aak. I’m in AZ and entry level houses are retailing for 200-250 in town (built in 1980, 1500-1700sf, 3/2, 7500sf lot, not in dangerous neighborhoods.) I’d be putting 10-20k into them for fixup on the deals I am seeing.

All the investors at our local REI clubs are talking about it being tougher to find deals now and I am just not sure if I should tie up my funds in lesser details or hold out for these $20k take home deals. NO experience doing deals yet so I just don’t know what I should set for a minimum profit.

I’m going to a fix/flip subgroup of our local REI club next week and also going to take a recommended fix/flip class (put on by our REI club) I’ll ask them their thoughts too.

For those who have worked with similar retail values, What do you think a profit should be on a house retailed for 200-250 wiht 10-20k rehab?

In my opinion if you are rehabbing a home that is valued over 200K you should make at LEAST 20K, but probably more. Any help on this one guys or girls? My rehabs are 100K and less.

Why don’t you do anything bigger?

That’s pretty much the area I am dialed in on right now. We are still in the somewhat early stage of building our business and have found this has worked very well for us. Plus the areas where homes are listed at $100,000 - $200,000 are absolutely flooded with listed properties and FSBO’s with not much moving. Can it be done right now over $100,000 here? Sure, but why would I set up a latter to climb 20 feet to pick fruit when there is plenty at eye level that tastes just as good? :beer

All real estate is local. Some towns you can make $20k on every deal and some $10k is a good deal. Look at the numbers and develop your strategy based on what is available where you are.

Sure, but why would I set up a latter to climb 20 feet to pick fruit when there is plenty at eye level that tastes just as good?

i fell off a ladder i know what u mean !!! :evil

I read your posts and I just feel complled to encourage you to go…wait for it…wait for it…all in! I see you debating the merrits of taking action, it almost seems as if you’re asking " Is it ok to only make $11K net on a house". Stop debating and get in there. I’m not being critical here, I’m really trying to be supportive. I see you have posted to this board 92 times but your still “researching and evaluating”. By all means, keep doing that, but you can do it while you cash $$20,000 checks that will ONLY net you $11K after taxes.

 I worked for 11 years for a company that decided at that point they could replace me with a cheaper model.  We parted ways and I decided I wasn't going to work for another company unless it was mine. SO for the past 4 months I've been committed to being in business for myself. Now I've absolutely spent hours reading these boards and others,  and spent thousands on books, training, seminars in the past couple of months, but 18 days ago $57K hit my bank account from my first deal (yes, unfortunately that's before taxes) and last week I got a contract signed for a short sale (no guarantees here) and another deal that looks like this:

3/2 with an ARV of $225-$240K
Purchase price $150,000 needs tearoff of old shingles, new ones installed.
Other than that just some paint and landscaping.

 Now, don't get me wrong, I know a fraction of what most of the other people on this board know (for now) but I do know that I didn't get paid a cent (before or after taxes) for reading and planning until I started making offers.  Bottom line is this is alot more exciting when you put the fear behind you and get in the game.

 Best of luck to you!

If you look at it from a positive point you are making more than the average person makes , so hang in there and keep moving on, it will pay off in due time.

I would ABSOLUTELY second that Jackqueline and All In. The first rehabs I did I made $7,000 and barely broke even on the next one. Since those I have really learned how to buy right, how to manage the rehab, and what it takes to make it in this business. It does take time to learn and grow, just like any job or business, but if you stick with it IT’S FUN!!!

" Is it ok to only make $11K net on a house". LMAO, that I guess IS what I am doing. Mainly because I just made 20k (before taxes) in 2 weeks by buying, fixing, selling 2 water trucks. We buy/sell anything we can make $ on.

$11k net is nothing to sneeze at. I guess I am mainly just unsure of labor costs, General contractor costs. I’d love to get to the point of… starting! LOL. no, I’d love to get to the point of having crews to do all the work, even with a general to do most theoverseeing. I’m just unsure of costs. I guess I need to take a potential rehab offered by a wholesaler that is on a lock box,. and get a few contractors to bid the job. Even if I didn’t buy that house, I’d get a feel for what the contractors would charge for it, and, I’d have some contacts made with different contractors to see who’d work. DUH! rolleyes It took until now to figure that out! DUH!

I’m so scatterbrained right now and overscheduled with several businesses and a 2 year old. My husband and I had a long talk about our goals for life/career and realized we have WAY too much going on. SO, were trying to sell off 2 of our online businesses and considering part time child care and a cleaning lady 2x/mo so I can concentrate on the RE business and my husband can go legit with our side business of flipping cars, rvs, equipment.

I have spent probably 20 minutes just to type that. I am so stressed and streched thin I can’t seem to get ANYTHING DONE. I know these are all just excuses though and people with tougher situations than mine are managing to do it. I guess I just need to get going and make some offers, and on the way, get organized and keep learning, and all those other things I am trying to do FIRST.

Thanks for your input guys, It’s so true, 93 posts now and nothing. AND, I’ve been "researching since OCTOBER 06! :(. I just need to send out those letters to all those frigging addresses I drove around for hours to get. But alas, I allow myself to get bogged down by “the next bitchin thing to hit my doorstep” which currently is a SUPER LOW price on a business rental that is PERFECT for my husbands buy/sell buis. But wait, how long exactly does a letter to a homeowner take!

ok, long enough on a POST AHHHHHHHHHHHHHHHHHHHHHHHHHHH. Could have wrote a letter to HO in that time. AHHH GOttta go get my daughter.

Thank you all!