Flipping a house for profit?

[Degen]

I would love for someone to explain to me who has experience in real estate the real costs of flipping a home. I watch all these reality shows on flipping homes and I found it so fake like all other things on TV. Maybe I'm wrong but please explain. Person buys a home for $500,000. He or she spends $40,000 on repair. He sells for $680,000. Right there that's $140,000 in so called profit. The first question how do they do so much work for just $40,000. I live in California and just do remodel my kitchen was going to cost $12,000. So how can they do a whole house for $40,000? How much of that does he or she keep (taxes, transfers tax, mortgage, realtor fees). Please fill me because the shows do a bad job of making it seem like anyone can do this. I also love how they show that everyone makes money on each episode. People need to realize flipping homes is a huge gamble and people can loose a lot of money too. Thank You

[penguinese]

There are a lot of books written on this subject. I wouldn't try to learn about it from reality TV if I were you... they are definitely not showing real life examples. They always seem to make a profit on those shows, and somehow they hire contractors to rip apart the whole house and put it back together again for a ridiculously low price. $40,000 repairs for a house that can be flipped (i.e. is a nice house but it needs a huge, huge makeover in order to make a significant profit) is nothing. You would have to a lot of the work yourself.

[Bill F]

Also read the discalimer at the bootom of those TV ads that YOUR results may vary graetly from the testimonals given !

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[mike1942f]

The real answer is that you put all the repairs in cheap and superficial for appearance (like the plastic faucets in my house that twisted off in early use and the stiff copper pipe forced into position till it cracked.)
And if you listen carefully, a bunch of these techniques require that you lie and trick the people you are getting the house from as well as the people you are selling it to.