A site reader who is trying to figure out how to flip a house recently sent me the following question:
My husband & I have been saving and studying to venture into real estate investing and your site is one of the most informative we've found. We are very much visual learners and appreciate that you expound on your topics with pictures and actual figures.
We're in the process of finding house #1 and it would be a tremendous (dare I say almost life saving) help if you could do a post sharing the template that you use to create the screen shots for the schedule, SOW/budget, and financial analysis. I'm sure a great deal of work went into creating them and if you'd rather not post the actual file(s), a post of larger screen shots would still be helpful(for some reason they come out as blurs when I try to print them).
Thanks in advance for your time & I look forward to more future nuggets from the site.
Nikki, thanks for the kind words. I am glad you find the site useful. Sounds like you guys are doing the right thing by spending time learning how to flip a house and planning before you start house flipping. That is the same place my wife and I were a couple of years ago when we decided to add real estate to our wealth building equation.
I am glad you mention you are a visual learner because so am I which is why I post the pictures and charts that I do. I think it's one thing to tell you how something is but it is another one to SHOW YOU…
Like you several years ago I was trying to understand how to flip a house. I would find all these people saying how profitable real estate investing could be but I could not find anywhere EXACTLY how profitable it could be.
"Show me the money!" I kept saying to myself...
Because it is not until you drill down into the details i.e. how much paint/tile/drywall etc. costs, that you begin to understand this business.
Anyway, here are links to the four core documents I use to plan and analyze my house flipping projects.
NOTE: These are PDF versions. If you want the Excel versions you can get them FREE by signing up for our newsletter:
First off I start with a scope of work. This is nothing more than a detailed to do list. Like I explain in this article on how to flip houses. I make a list of the "should do", "could do" and "must do" first. I try not to leave anything out, I will narrow it down in the next step.
Document 2: Budget
Now I take the items from the SOW and start putting together a budget. Here I put the detailed list of repairs into a spreadsheet where I assign what trade is going to do what and most importantly how much it's going to cost. This document will help me see what estimates I have to get, materials I have to buy and my total rehab budget.
Now that I have estimated how much my repairs are going to be I can use this analysis spreadsheet to calculate if the property has potential to be a good deal. By being able to see my estimated expenses and potential profit I can then make decisions based on these projections.
Once I have purchased the property (of course) and decided my rehab scope and it's time to get to work then I put together a schedule. This is important because some activities are dependent on others and not everyone is available at all times. Believe me, if the painter shows up and drywall is not ready to be painted it might be another week or more before the painter can show up again (IF he shows up again).
Document 5: Financial Analysis -(Excel Version)
The final step in how to flip a house is the financial analysis. This allows me to keep track of my investing performance. It lets me know how good/bad I did in this project and serves me as morale booster, lessons learned and makes me an overall better investor.
For example, the biggest lesson I have learned on how to flip a house, from doing the financial analysis is the fact that I have gotten my best investments when buying houses at 48-51% of what I eventually can sell them for. This in turn helps me when looking for the next investment.
When trying to figure out how to flip a house the above information is crucial. I hope this helps. You can use the comment form below if you or anyone else have any questions.
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