How an Expert House Flipper Would Start Over

TLDR
Thirteen years in, this is what I’d do if I had to start over. Deals 1-3: find one great deal, don’t overcomplicate the corporate structure, save cash. Deals 3-8: minimize renovations, buy a rental, get a property manager. Deals 8-15: inch-wide mile-deep on one profile. Then scale with partners.

Table of Contents

Thinking in Phases

At the time of this recording it’s exactly 13 years since I closed on my first flip. I thought, what would I do if I started over today? That’s what this whole thing is about.

I’m going to break the answer into phases: deal one through three, deal three through eight, deal eight through 15, and beyond.

The reason I think in phases is that most people get freaked out about flipping because you see a hundred different strategies from a hundred different gurus. You have to set up an LLC in Wyoming for some tax reason. You have to know all these things about entity structure and liability. You have to pick between wholesaling, flipping, BRRRs, or subject-to.

I don’t think real estate investing is actually that complex. People talk about the complexity because hiring them or paying for their service is how they make money. In business, you need something to sell and someone to sell it to. In flipping, you need a house that can make you money and a way to get it to the finish line. The rest is fluff. Maybe necessary fluff, but not necessary to get started.

Most people don’t start. And not starting has a real cost that nobody talks about.

How I Actually Started

I actually had two starts. The first was rental houses while I had a high-paying corporate job. I bought rent-ready stuff with bank loans. The delay between each rental was just saving up the 20% down payment, which is the real bottleneck for most people getting into this.

Here’s the math that got me hooked. A $300,000 house bought today, owned for 30 years, at a conservative 3% appreciation, is worth $728,000. The 30-year mortgage is paid down to zero. That’s where most people’s wealth comes from. And the tenant pays the mortgage, not you, if you’re underwriting the deal correctly.

My thought was: if that formula works on one house, why wouldn’t I own a hundred of them? That’s the game.

But that first three took me years. So eventually I decided I wanted to break away from the corporate job and really flip houses to supercharge the cash.

I did it way too early.

I bought a flip from a wholesaler with a humongous project. I was going to take the roof off and build a second story. No experience with anything like that. After I bought the property, the foundation was crumbling. So I rebuilt the whole foundation from the inside of the house because I was terrified of permits. I was digging 10-foot sections, three feet deep, because I was in Colorado and the frost line is three feet. Wheelbarrows of dirt through the house, out to a dumpster. Pour a footing, build cinder block on top, repeat.

550 days straight on that property. I pocketed around $200,000 on the sale. Sounds great. But I drew personal savings to pay interest. I sold my truck to keep going. I lived in a tent in the backyard at the job site, then in a pop-up camper on the ground.

And the biggest lie of all is that I thought the $200,000 was from being a good flipper. It wasn’t. It wasn’t from forced equity from the construction. It wasn’t from a good deal on the front end, because I didn’t get a good deal. It was pure market appreciation. I rode a wave. If I had sat on the couch and done nothing for 550 days, I’d have made the same money.

Common Mistake
Don’t confuse market appreciation with skill. The market made me $200,000. I thought I’d earned it, so naturally I took on an even bigger project next. That was a catastrophic mistake that took me years to reverse.

If I could do it again, I would have stayed in the corporate job longer, bought more rentals on the side, and built a better position before I went all in. But I was young, single, no kids, so I could do stupid stuff like live in a tent. Here’s what I’d actually do now.

Deals 1-3: Find One Deal

The goal on these three deals is one thing: find a great deal on the front end. Not complicated corporate structure, not a perfect CRM, not systems. Just one deal that actually makes money.

Set up the LLC. Easiest way possible. Online, cheap, fast. Go to the bank, set up a checking account in the LLC’s name. That gives you enough liability protection. I’ve set up many LLCs in the parking lot of the bank before opening the account. I’m not an attorney, so if you use that advice it’s on you.

Focus 95% of your effort on deal finding. You only need one deal right now. Pull a list from PropStream, Property Radar, or BatchList. Pick absentee owners in the hottest neighborhoods that you want to buy in. The up-and-coming areas with other flips going on. I’d want houses 700 to 1,600 square feet, owned more than two years, 30+ years old, right in the heart of town.

Send mail. Yellow Letter is one I’ve used. Figure 1% response from postcards, get better over time. 1,000 to 2,000 postcards should produce a deal. Work the phones. Keep people in a spreadsheet, not a CRM. Bonus: set up a landing page so you look local, because being local is an advantage against the out-of-state wholesalers who are sending the same kind of mail.

Get a deal under contract. Then go find the money. Go to a hard money lender. If you have an actual deal, you’ll find the money easily. That’s why deal finding matters so much. I’d set the closing out 30-45 days to give me time.

What counts as a deal. Purchase price plus renovation at around 70% of the ARV. Broad, but real. Run the actual math, but 70% will get you there.

Meet contractors before close. You probably can’t get them into the house yet. Show them your scope of work, videos, and detailed notes. Take the pressure off by saying, “I know you can’t give me an exact price because you haven’t seen the property. I just want a ballpark so we can start building a relationship. Once I close, I’ll get you in there.” That way if the deal falls out, you haven’t wasted their time building relationship capital.

Tight leash on personal finances. Build in a lot of financial contingency. There will be surprises. Even with experience there are surprises, and the first one can take you out of the game. I’d expect deal one to include a $40,000 to $70,000 renovation. Something small enough to manage, big enough to force me to learn.

List the property. Use a real real estate agent, or list it for sale by owner through a real estate brokerage so you get on the MLS without looking like a desperate seller. Never a true FSBO listing. That just signals “this house is worth less.”

Don’t start marketing for deal two until deal one is closed. No overlap. Preserve bandwidth.

Pro Tip
Deals 1-3 take 12 to 18 months. That’s okay. You’re not in a hurry here. You’re gaining skills, experience, and cash. The first million dollars is the hardest one to make because it’s about the skills, not the money.

Deals 3-8: Minimize the Renovation

When I actually did this, I went the opposite direction. Bigger projects, then bigger, then bigger, until I finally had a project that broke me. I had to fire every subcontractor I was working with and finish the biggest project of my life alone. Lots of lessons in there.

What I’d actually do: go smaller, not bigger.

Hunt wholetail deals and cosmetic flips. Where there’s barely any construction. You got such a good deal on the front end that the value was added at purchase, not by the rehab. These are hard deals to find but at this point I’m getting better and better at finding them. Minimizing construction reduces risk at the exact moment I should be reducing risk.

Buy the first rental. Look for non-institutional lenders. Certain Lending and Kiavi are two I’ve used. They give you 30-year fixed mortgages on rental properties based on the appraised value of the asset, not the cost. That lets you BRRRR and pull most of your money back out.

Get a property manager. Don’t spend the time managing the rental. Focus is fine-tuning deal finding, not learning property management from scratch.

Upgrade the deal-finding channels. Add a channel. Maybe cold calling high-value lists like condemnation lists or water-off lists. Water-off lists are great because if someone can’t pay their water they’re probably motivated, and water is a public service so cities often share the list.

Build a real CRM. Probably Airtable or something similar. Not a paid service, because the monthly fee cuts into cash reserves. Cash is still the focus.

Keep hard money loans. Don’t start paying cash. Keep the cash reserves. Cash in this game is the power to make the right decisions. It’s not about buying houses with cash, it’s about never making a decision from a position of scarcity.

Small overlap between projects. Once a project is through inspection resolution, start marketing for the next one. Not before.

Pro tip: look for subject-to and seller financing. These barely count in the property count because they’re bonuses. A subject to lets you take over the mortgage payments without a new loan. Seller financing lets the seller be your bank. Both are powerful if you find the right situation.

Deals 3-8 take another 16-24 months. Not speeding up. Gaining skills, cash, and now a rental.

Deals 8-15: Inch Wide, Mile Deep

After my big-project disaster I adopted a different strategy, closer to what I use now but not quite. I was trying a lot of different things and wasn’t near as laser-focused as I should have been.

If I had to do it again, I’d be even more focused.

Nothing but the exact property profile I want. Inch wide, mile deep. Every project has the same process, the same look, the same finish. You can’t tell them apart on a spreadsheet. Can’t tell them apart in photos.

Build every system around that profile. The scope of work template, the pay schedule, the hardware package, the paint colors, the flooring, the cabinets. Same every time. Speed and repeatability come from sameness.

Up the rental count. By the end of 15 deals, I’d want at least three, ideally five, rentals.

This is the phase where the work is the base. All the different things you want to try, that’s fun, and you get to have fun after you build the base. Build the base first.

Deals 8-15 is the period where discipline beats curiosity.

Beyond Deal 15: Supercharge With Partners

This is where my actual story picks up. I felt ready to take on partners, especially money partners who weren’t interested in being as active in the field as I was. They bring cash, I bring execution.

I built a construction company, a wholesale company, a property management company. All I did was real estate. Partners, lots of them, mostly cash, most not local. Other partners were more active. We raised private equity and private equity funds. Lots of growth.

End of that huge growth period, I downsized a lot of it.

If I had to do it differently now, I’d still build through partnerships, but I’d be picky. Specific about what partnerships look like, separation of duties, expectations both ways. When you’re growing fast the first time, more is better and you don’t think about that. Second time around I would.

Key Concept
You build real wealth in real estate by accumulating rental properties and compounding them. Flipping is the cash engine that feeds the rental portfolio. Partners are the multiplier once you have the system. Don’t skip ahead to partners before you have the system.

FAQ

I’m brand new and don’t have the corporate job or savings. Can I still do this?

Yes, but your first phase has to be cash accumulation, and flipping is harder without a safety net. Look at house hacking with an FHA or VA loan. Live in a duplex or fourplex, rent the other units, fix up as you go. That’s how I got started in a way. It buys you low-risk reps.

How do I know if a deal is actually a deal?

Purchase plus renovation at around 70% of the ARV is the ballpark. Run the arv math in detail before you commit. If you can’t explain why the number works out of habit, you don’t have a deal yet, you have a hope.

Should I quit my corporate job to flip?

Not yet. I quit too early and paid for it with a 550-day project. Stay in the job, stack rentals on the side, build skills. When you leave, leave with a cushion and a plan, not a wholesale deal on a roof replacement you’ve never done.

How long between deals 1, 2, and 3?

I’d expect 12 to 18 months total. That feels slow. It’s not. You’re building the skill stack that makes deals 4-10 possible. If you’re not patient here, you’ll compound the wrong lessons later.

When do I start taking on partners?

Not until deal 15 or so. Partners accelerate what’s already working. If the base isn’t built, partners just accelerate the chaos.