Flips vs. Rental Properties

Rentals or flips?  People are often very passionate about one over the other. A lot of this may stem from comfort, or just bad luck with a reno or a tenant. There’s always someone that has a horror story.  One very bad tenant can make you think twice about the rental industry.  Obviously we have dealt exclusively with rentals, but I think there are definitely some pros and cons to each.

If you’re thinking about getting into the housing market, before choosing rentals or flips, I think you first need to think about your goals. Most people are looking to make money, so ask yourself, “Is this something I want to invest in for later, or for quick cash now?”  Another question to ask yourself is “How much time do I have to actually devote to this?”  Time is literally money for both rentals and flips, and if you don’t have the time or can’t make the time it will be very difficult to be successful (at least when you are first starting off).

So I have done my best to take an objective look at both industries and give my perspective on each. Personally, we are looking to try a flip, so this is something we have thought a lot about and how it will fit into our schedule. The quicker you can do a flip, the more money you can make. This is possibly our biggest obstacle as we already have full time jobs, and rentals on the side. Learning to juggle all three would be tough, but possible if we take on the right flip.

Ultimately, flipping is a business. If you aren’t flipping a house you aren’t making any money. Renting is more of an investment. Once the properties are rented out, you don’t physically need to be working in order to make money each month. Our reasoning for looking to do a flip is to make quick cash to invest into a larger rental unit that can make us more money over the long run. I think flipping and renting can complement each other and help you reach you overall goal.

So before diving into one or the other, take some time to write down your goals so you have a clear vision of what it is you want to accomplish and how. Make sure to take into account how much money you have to invest and how much time you can dedicate to either. There will always be obstacles, but the more prepared you are, the better off you will be. Best of luck and I would love to hear your perspectives on renting vs flipping!