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9 Things TV House Flipping Shows Don’t Really Tell You

Written by Posted On Monday, 16 October 2017 08:56

It seems that everyone loves a good TV show about real estate flipping. Entire networks were created to capitalize on this fascination. Although these shows have elevated awareness of real estate investing and home flipping, they have created erroneous ideas about the reality of flipping a home.
Here are nine truths you don’t learn from watching house-flipping reality shows.
Truth #1: Finding the Right Property Takes Time and Energy
When watching a TV show, you might get the impression that finding a property is easy and takes no time at all. In fact, you never see the “behind-the-scenes” work needed to find the right deals. 
Most investors spend money and time each month looking for motivated home sellers. When calculating your profit, you’ll need to be sure to include the cost of finding the property in the first place.
Truth #2: Flipping Is Not Easy
That’s not to say that it is difficult, but it isn’t as simple as buying a house, fixing a few problems, and then selling. There are lots of points to consider to determine the right property. Problems can happen along the way, such as misjudging costs or being unable to find a buyer. In order to make money on flipping a home, you need to have the right knowledge-base to do so wisely.
Truth #3: Your Actual Profit Often Doesn’t Match Your Projections
Although you need to project potential profits to find the right deal, the truth is that your actual profits will be different from your projections. Many things change throughout the process from buying to renovating to reselling.
Truth #4: You Should Look at More Than Three Properties
TV shows always show three properties and then the investor or homebuyer must make a choice. This pool of three choices is good for TV since viewers only have so much time or attention span. However, in real life, an investor would be unwise to only look at three houses in any given market. The more homes you look at, the better you will be at making the right decisions and finding the right properties.
Truth #5: House Flipping Is Not a Get Rich Quick Scheme
If you are looking for a way to get rich quick, then you need to look at something else. House flipping is hard work. Although you can make big money with real estate investing, it is done one property at a time over a period of time. 
Truth #6: Flipping a House Takes More Time Than You Think
When you watch a reality TV show, you get the impression that the home is purchased, renovated, and sold in a matter of a few weeks. The truth is that they don’t show you the waiting periods for permit approvals or inspections. They don’t show you weather delays or financing difficulties. Some financing even requires that you hold a property for 90 days. When looking at your profit margin, be sure to be realistic about the time it will take to flip the home.
Truth #7: Some Renovations Do Not Add Value To a Home
When watching reality TV, you may get the impression that anything you do to your home will add value. This is simply not true. Not only that but doing the right thing the wrong way will also not add value. Kitchen renovations can add value, but not if you renovate beyond the value of the home. Adding storage can add value, but adding a $20,000 closet will cost your money. You need to be smart about the renovations you do to a home.
Truth #8: Renovation Is More Than Knowing What To Fix
Construction projects are more than swinging a hammer in the right direction. You also need to understand rules, regulations, permits, zoning, codes, and more. Buying a home in a location with tight restrictions will be far more costly than buying one without such regulations. Be sure you understand the governing rules in your market.
Truth #9: There Is a Whole Team Involved
TV shows might lead a novice to believe that the only two people involved in a home-flip are the investor and the buyer. The truth is that there are many people involved in the flip including: • Original owner • Financer • Contractor • Agent • Lawyer • Inspectors
Contact me to learn more truths about home flipping. I’d love to help you get started on your path to financial freedom.

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John Trautman

John Trautman has spent his entire adult life in real estate. Purchasing his first property at 23, he learned the process of flipping and real estate holding from the ground up. Real estate continue to be his passion while he spent eight years as an account executive and later a vice President for Washington Mutual in the mortgage division. Holding the position of President’s Council and several years of President’s Club, he learned the lending business from the mortgage office perspective and lender perspective. Throughout his life he has also been a small business owner, commercial real estate holder, property designer, and house flipper.

During the downturn, John followed the deal to Detroit, Michigan, where he invested in single family rentals and multi-family dwellings. Once his returns were realized, he moved quickly to Arizona to invest in another distressed market.

His passion for making a deal and real estate has lead him to create a hands-on real estate investment mentoring club called Real Estate Knowledge Institute


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