How to Get Started Investing | Live in a Flip House

January 27, 2020

A great stategy for beginner real estate investors is to live in a flip house. One big challenge that new real estate investors encounter is capital. This strategy is beneficial for investors who are just starting out and can only afford one property.

Real estate tips for beginner investors  who want to live in a flip house | Building Bluebird #rei #flipping

It also allows investors to avoid capital gains taxes if they use the property as a primary residence for more than two years. While there are benefits to this strategy, there is the whole, “living in a renovation zone”, that also need to consider. We used this strategy with our first three homes and we were able to grow our wealth substantially over 6 years.


Tips for the Live-In Flip Real Estate Strategy

1 | Choose an Appreciating Area

This is the best way to ensure your success with a live-in flip house. When we were living in Denver, the real estate market was INSANE. We were really lucky to be living in a city experiencing a huge boom.

Real estate tips for beginner investors  who want to live in a flip house | Building Bluebird #rei #flipping

Over the last 10 years, homes in Denver were appreciating by over 7% each year. When you couple appreciation with improvements to the home, your chances of successfully making a profit on your home are very high.

2 | Find the Worst Home in the Best Neighborhood

With most house flips, investors will look for the worst home in the best neighborhood. The same is true for the live-in flip strategy, except you live in the worst house while renovating it. It is definitely a little more challenging! Chris and I had a knack for finding undervalued homes in the best neighborhoods of Denver.

Real estate tips for beginner investors  who want to live in a flip house | Building Bluebird #rei #flipping

Our first home was in the popular neighborhood of the Highlands with great walkability and access to downtown. We poured sweat equity into that home sold it for $90K more than what we purchased it for two years prior. We probably spent $30K on improvements in the house giving us a great return after selling the property.

Real estate tips for beginner investors  who want to live in a flip house | Building Bluebird #rei #flipping

3 | Know the Comps & Top of the Market

Work with a real estate expert on what other homes are selling for in the area. These comparables should include properties that are similar in style and size to yours and include the upgrades you plan to put in the home. It is also important to look at the finishes of other homes in the area to avoid spending too much on upgrades in your own property.

Real estate tips for beginner investors  who want to live in a flip house | Building Bluebird #rei #flipping

If every other home in the neighborhood has modest kitchens with laminate countertops, you may want to think twice before installing the most expensive quartz countertop on the market. Don’t outprice your home in that particular neighborhood.

Real estate tips for beginner investors  who want to live in a flip house | Building Bluebird #rei #flipping

4 | Design for the Masses, Not For You

Your personal home is a place to express yourself and create a unique space just for you. This can be one of the biggest challenges when living in a flip house. Every choice you make should be through the eyes of a buyer and maximizing profit.

Real estate tips for beginner investors  who want to live in a flip house | Building Bluebird #rei #flipping

Try to remember your initial reaction to the home the first time you drove up to the property. Think about what you disliked and what distracted you from other wonderful features in the home. Your goal is to highlight the best features and fix/minimize everything you disliked during that first visit.

Real estate tips for beginner investors  who want to live in a flip house | Building Bluebird #rei #flipping

When choosing paint, opt for the more neutral colors, even if purple walls really make you happy. Neutral kitchens with stainless steel appliances are universally accepted. I would encourage you to add your personal style with your decor and artwork and avoid adding it in places that are harder to change.

5 | Consider Livability & Renovations

While this strategy may seem to have less risk involved, living in a construction zone is not for everyone. Be honest with yourself about how you could handle living through noise, dust, and torn up spaces.

5 tips for successfully flipping your personal home | Building Bluebird
#rei #realestate #houseflipping

It is also important to think about your season of life and how that may affect others in your family. In the beginning, Chris and I found properties that required more cosmetic updates and adding living space to the exterior.

Book your stay through Airbnb at the most charming home in Sylvania Ohio

When we started to include larger renovation projects living in our third flip house, we made sure to plan ahead and often moved out for the messiest parts. This got trickier as our family grew and we ran into challenges like giving birth while our kitchen was completely torn apart!

5 tips for successfully flipping your personal home | Building Bluebird
#rei #realestate #houseflipping

This real estate investment strategy is not for everyone, but it is a great way to get your feet wet if you are ready to learn and start making money!

Additional Real Estate/Investing Content

If you found this helpful, check out my Instagram feed (@buildingbluebird) where I co-host a weekly series called Renovate to Great. Each week we cover a topic around this specific real estate strategy and feature guests to share incredible knowledge with our audience. See you on the ‘gram!


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5 tips for successfully flipping your personal home | Building Bluebird
#rei #realestate #houseflipping

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2 Comments

  • Reply Laura Yazdi February 2, 2020 at 1:28 am

    I’ve been listening to your podcast nonstop and on repeat. Finally got a chance to visit your blog today. Thank you for all the great tips and I am looking forward to more podcasts from you two!

    • Reply lindseymahoney February 3, 2020 at 12:08 pm

      Thank you so much, Laura! That really means a lot to hear from a listener. 🙂 We have more new content coming this month!

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