California flipper Joe Homs breaks down three rules for your first house flip: do honest math on costs and profit before you buy, lock in your target sale price and stick to it even if the market drops, and walk away if the numbers don't work.
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In today's video, I'm going to show you how to avoid messing up your first flip. Coming up next. Nobody likes to mess up, especially when there's a potential of making some serious money or losing other people's money. This tends to be one of the biggest fears of new investors, but it doesn't have to be. Here are 3 ways to avoid messing up. Welcome back. I'm Joe Homs. I flipped hundreds of homes in California. I made this channel to help the new and experienced investor. Don't mess up by missing another video. Make sure that you subscribe and like right now. Do these things to avoid messing up on your first flip. The first biggest thing that you need to do is to learn how to analyze a deal from the after-repair value to the rehab costs, all the costs that are involved in selling the property Closing costs, commissions, and at the end of the day, how much of a profit you're looking, you projected to make. You make your money on the purchase, not on the sale. So make sure that you know your numbers. So make sure that you don't really second-guess yourself. I mean, you're putting together a spreadsheet of all the expenses that are involved in this, and obviously you're trying to make this number work at the end of the day. Don't start fudging your numbers, making sure that your rehab is going to cost this much and you say, well, maybe I can save if I do it this much because then I'll make a little bit more profit. Be realistic with yourself, be a little conservative, and make sure that your numbers are correct. Number 2, stick to your original ARV, after repair value. I always like to do it twice. I do it right before I purchase the property and then I always do it right before I put the property back on the market. So make sure that you hopefully can stick to that ARV that you originally had. In this type of market, we're in a downturn, so make sure that your ARV on the purchase is very conservative because it may have gone down by the time you put it back on the market. But you should know that up front. And remember, don't fudge repair costs because honestly, they never go down. If anything, They go up. A value add, or you want to do this, you want to do that. You should hopefully have all that figured out before you buy the deal and go into it and start the contractor process. But make sure that you don't fudge your numbers. Don't get emotionally tied to any property. Stick with your math. Stick with those numbers that you come up with. If it works, go for it. If it doesn't work out, forget it. Move on and find another one. There will always be another house to flip. If you're new to flipping, click on this video right here. I'll show you a flip I made a huge profit on. You want to learn how to do the same? You can find my information in the description box below. I'm always here to help.
