Is House Flipping a Bad Word?
If you want to make money flipping houses, then you must be comfortable promoting yourself. At the very least, when someone asks what you do, you should be proud to tell them that you are a house flipper.
Well 8 months ago when I began House Flipping School, I will readily admit that I was not 100% confident in promoting myself as a house flipper. Making money flipping houses is near and dear to my heart, but I was not sure I wanted to promote myself online as a house flipper because of the negative connotation house flipping has received recently in the media.
We all know that banks and the government are not particularly fond of house flippers. Perhaps people in your own personal network are turned off by the term. Unfortunately house flipping has received criticism because some individuals and companies go about it in the wrong fashion.
In certain cases, I believe house flipping does warrant some negative criticism. As with any industry there are always a few bad applies that spoil the pie (is that a real saying or did I just make that up? LOL). In the real estate industry we certainly have our fair share of "scams, scoundrels and scandals" as the hit TV show American Greed would put it.
In response some house flippers have transitioned to referring to themselves as rehabbers and residential re-developers. I think their strategy is to avoid the house flipping phrase all together. When I first met with my future House Flipping School marketing team during the spring of 2012, I was seriously thinking about traveling down this path myself.
Of course by now it's pretty apparent that I decided to stick with calling myself a house flipper. Here's why:
I Make Money Flipping Houses
When we first met, my marketing team asked me "What do you do Mike?"
I said, "I make money flipping houses."
My team replied with, "OK, then that is what we are going to do." Instead of avoiding the house flipping phrase, my marketing team recommended that we base our entire online presence around the term.
"Is this really the right move?" I remember quietly thinking to myself. At the time I was concerned about being grouped with the unethical house flippers. I battled with whether or not this was a smart branding decision.
Yet over the past 8 months I have realized that there is a huge branding opportunity here for not just me, but for you as well. Because house flipping has some negative connotation to it, anything with the house flipping term attached to it instantly gains attention. Put another way, if you Tweet something out that includes "house flipping" I believe the controversial component to the phrase helps get more eyeballs on the content.
Furthermore, there is an opportunity here for honest house flippers like you and I to change the public's perception of people who flip houses and make money. In reality, when I flip a house, I am helping the neighborhood and the local community. Here are some examples of what I'm alluding to:
- House flipping brings taxes back to the community - what town doesn't want more tax revenue?
- House flipping puts people to work - plumbers, electricians, contractors, interior designers you name it and we hire them to do work on our properties.
- House flipping generates income for local lumber yards, supply shops etc. - I can't even fathom the amount of $ I have invested in materials over the years.
- House flipping can increase the home value of entire neighborhoods - if you completely renovate a run down home, then the value of the house next door may also increase.
The list goes on and on...
What House Flipping is NOT
The biggest misconception some people have about house flipping is that it is a get rich quick scheme. Unfortunately some of the guru programs out there sell their courses based around this disguise. I will be the first to look you directly in the eye and tell you that making money flipping houses is anything but a get rich quick scheme.
The 5 simple steps I talk about in my house flipping eBook are indeed simple - but they do not and cannot happen quickly. Finding a good deal, securing financing, managing the remodel and selling the home require a great deal of time, energy and effort. Assembling a house flipping team of lawyers, lenders, real estate agents and contractors can take even longer.
Again this is not a bad thing at all. Successfully flipping a house requires a great deal of effort, and because of this, most people will drop out before even getting started. I'd be willing to wager that most folks who buy a mentorship or educational program do not actually end up flipping a house because they did not realize what they were getting themselves into.
Therefore if you are truly committed to making house flipping your career, you automatically separate yourself from the rest of the pack, because you have the proper house flipping mindset required to succeed in this industry.
House Flipping Conclusions
The next time you overhear a colleague bashing house flippers, or see another American Greed episode highlighting a real estate scam, quietly remember the benefits of house flipping listed above. I firmly believe that house flipping is a career choice that cannot only help you and your family, but can also help the community in which you conduct your business.
And if you are just starting or thinking about starting in this business, understand what it is you are truly doing. Through house flipping you can add value to your community, provide a home to someone and achieve the financial freedom we all so dearly desire.
Like what you read? Get our free eBook "How to Flip Houses in 5 Simple Steps" to supercharge your house flipping career and get all kinds of cool insider strategies not discussed on the blog here.
Unfortunately FHA apparently views house flipping as unethical somehow, at least that’s how their underwriting makes it appear through the implantation of “anti-flipping” rules. I really think the original implementation was during the easy loan times of 2004-2007 when some areas of the country like California had appreciation rates so high that someone could buy a house and flip it to another buyer (apparently to FHA the next buyer is naïve) and make a profit. I could see where FHA might consider that unethical….maybe. Ok, no I don’t really see that either. If the buyer has the right to have the property appraised and it appraises at the contract price or higher, why should FHA be able to have any say over that whatsoever, but of course they do. But I do think the original purpose was to “protect” consumers on properties that had a large increase in value with little or no change to the improvement.
That’s our government.. always helping. Like the Community Reinvestment Act which required banks to loan money to borrowers who couldn’t possibly pay it back.