House Flipping (with no taxes)!

[Texas Proud]

Quote:

Originally Posted by tryan Funny to see so many wrapped around the axle .... EVERY flip has utilities and taxes - occupied or not. No one works in the DARK. The heat is on and your taxes come due whether you live there or not. Maybe the utilities were a little higher because someone lived there ... but it's negligible. Living there for "free" makes sense to me ... to think otherwise is nit-picking.

I think that the nit-picking is in the description of the amount of gain....


If the amount of gain claimed takes out ALL expenses paid on the property, then I guess you could say "I made a net profit of X and lived there for free".....

Or, you could say "I made a gross profit of Y and had living expenses of Z"... that would mean Y-Z = X.....

You could not make the statement that you had gross profit of Y and lived for free.... in this case, who paid for Z



I do not think anybody is saying that you are not saving money by living there instead of someplace else....

[golftrek]

OP here. Of course I had some expenses like utilities and taxes but no rent expense. So maybe my statement should be that I made $100,000 and lived RENT FREE!

As for the issue of lost opportunity, what other investment could I have invested in and made $100,000 over 2 years TAX FREE and also got a place to live rent free?

You guys just can't believe that money can be made like this. Believe me it can be done.

Jo Ann

[Bestwifeever]

Quote:

Originally Posted by golftrek OP here. Of course I had some expenses like utilities and taxes but no rent expense. So maybe my statement should be that I made $100,000 and lived RENT FREE! As for the issue of lost opportunity, what other investment could I have invested in and made $100,000 over 2 years TAX FREE and also got a place to live rent free? You guys just can't believe that money can be made like this. Believe me it can be done. Jo Ann

Why do you think no one believes people make money flipping houses?
Can't anyone who has a net profit (after deducting all the costs of housing and remodeling) when he sells his primary residence also claim he lived for free plus made whatever profit? I can think of plenty of people who did that including DD, for whom it was a little more than $100k and it was only 14 months. I will have to let her know.

[HFWR]

Quote:

Originally Posted by golftrek You guys just can't believe that money can be made like this. Believe me it can be done. Jo Ann

I know several who have made lots of money in real estate, but it usually involves buying, then upgrading to a newer home while renting the other. Lather, rinse, repeat. I've never wanted to be a landlord though. As far as "flipping" is concerned, IF you can buy right, but for much of the country, the rabid rapid appreciation needed to make big bucks in a short time isn't there.

[ERD50]

Quote:

Originally Posted by Bestwifeever Quote: Originally Posted by golftrek ... You guys just can't believe that money can be made like this. Believe me it can be done. Jo Ann Why do you think no one believes people make money flipping houses? ...

Exactly. I don't doubt that people can make (or lose) money flipping houses, not at all. But if anything is driving any dis-belief, it is the OPs insistence on faulty accounting.

Quote:

Originally Posted by golftrek OP here. Of course I had some expenses like utilities and taxes but no rent expense. So maybe my statement should be that I made $100,000 and lived RENT FREE!

Ridiculous. I have a mortgage, others have paid-off their home, we're not paying rent, so I guess we can say we live RENT FREE! True, but meaningless.

Quote:

As for the issue of lost opportunity, what other investment could I have invested in and made $100,000 over 2 years TAX FREE and also got a place to live rent free?

Doesn't make any difference whether the opportunity would have made more or less after-tax than your investment. The point is that you need to take it into account (whatever it was) for a true picture.

SPY is up ~ 55% over the past 2 years. I think you said you put up $250K - so SPY would have returned ~$137,500 ($117,000 after 15% taxes on gains) but there would be no working, no living in a home being remodeled, no added expenses (those numbers are net of expenses). That doesn't mean you shouldn't do what you are doing, but they are all factors.

Quote:

You guys just can't believe that money can be made like this. Believe me it can be done. Jo Ann

Methinks the lady doth protest too much.

-ERD50

[NW-Bound]

Accounting issue aside, if the OP enjoys doing what they do for the gain that they get, why not? I know I do not have the temperament to do the same, but people are built differently. It is the same as being a landlord. People can make a good living doing that, I am sure, and perhaps may be pitying office workers who are cooped up in a cubicle all day.

[suming]

Quote:

Originally Posted by wmc1000 As for keeping kitchen remodels cost -effective I re-did my daughters kitchen 18 months ago by resurfacing her laminate coutertops with new Wilsonart High definition laminate and they look superb. Less than $500 to do the entire kitchen.

wmc1000
Would you please share more info about this laminate? My 10-year-old kitchen countertops got burnd by heated pot last year. How much per square foot? Are you an experienced craftsman to be able to resurface it? I've checked some website for the Wilsonart High definition laminate. Where did you buy it from?

[Sesq]

I don't think my family would go along with this strategy, and my skill set would be a bit lacking. But I admire the OP for pulling it off. The guy who built our house used to move into a new build (basically cookie cutter) in our long expanding neighborhood (coming to an end). Since the floorplans were very similar (they tweak a bit each year) and the schools the same (they have kids) it was about as easy as it gets. I've noticed that they have stayed put the last several years. I assume his wife got tired of it after 3 or 4 of these. At least she didn't have to live in remodels.