Man Measuring Counter for Kitchen Renovation

Lessons Learned From Flipping My First Home

Blog Contributor Commercial & Investment Real Estate, Establishing Your Business, Rental Properties, Residential Real Estate Leave a Comment

Share this Post

Alex Craig

By Alex Craig

Finally…I took the plunge. After nearly five years as a real estate agent, I flipped my first property. And gosh, did I learn some valuable lessons.

As real estate agents, we have unique skills, knowledge, and access to opportunities for investment properties. Being an agent can provide an opportunity to earn in the investment world—from fix-and-flips to long-term rental holds.

So, if you’re thinking about using your skills, experience, and access to get into the investment side of real estate, listen up. I’m sharing some lessons I learned from flipping my first home.

You Can Still Profit

When I finally felt ready, with enough knowledge, skill, and assets to invest in real estate, I convinced myself that it wasn’t possible to earn a profit.

Man Measuring Counter for Kitchen Renovation

©Rick Gomez – Getty Images

Every home was selling for above asking, even the dilapidated fixer-uppers. It seemed like every real estate investor and HGTV fanatic was competing for potential properties, driving prices up and whittling away profits.

“There is no way anybody can be earning money on these flips,” so I thought.

Turns out I was wrong…

…dead wrong!

It’s possible to profit from flipping a home in today’s market.

I won’t discredit the market conditions. They have made house flipping harder—significantly harder than the times during the Great Recession.

In this market, if you want to make a profit, you need to find the right opportunity and buy only on the right terms. It’s far more important to purchase the right property at the right price, than to turn a bad deal into a good deal.

Learn to Think Like an Investor

Throughout my five years in the business, I have had the privilege of working with investor clients—from the client selling his duplex to the client looking to acquire single-family rental homes.

Working with these clients gave me a strong understanding of what they were looking for and how to analyze deals. But, flipping a house? That provided a much deeper level of understanding and empathy. Now I feel more empowered to connect with my investor clients on an emotional level. I actually understand what it’s like to buy a property, rehab it, and sell it.

There is a difference between understanding something and experiencing it. Prior to flipping a home, I only understood. Now, I have experience.

This is an added benefit and skill I can offer my clients. By properly communicating this in my marketing, I can make a point of differentiation among other real estate agents in my area. This will help me win more clients and better serve them.

Profits and Risk are Larger

Unlike many first-time investors, I did really well with my first flip, achieving 20% profit of the ARV and nearly a 50% cash-on-cash return for a home I held for five months.

I learned that on successful deals, my profits are much larger than my typical commissions. In one fix and flip, I made the equivalent of selling nearly $1 million in gross sales, which is the equivalent of selling five to six homes in my area.

However, investing requires more risk. It’s like putting all my eggs in one basket. If things don’t go well, it’s going to be a bad time.

Intimate Neighborhood Knowledge

Since I was personally invested in my flip, I was obsessed with understanding the pricing in the neighborhood. For three months, I looked at comparables and ran several CMAs (comparable market analysis) on my home.

I became intimately aware of pricing in the neighborhood. Now I can look at a house in the area and know what it will sell for without even having to do a market analysis. That is a strong skill and knowledge to have. First, it puts me in a position to instantly recognize potential investment opportunities. I can also help clients that either need to sell a home or are looking to buy a home in that neighborhood.

You can build this skill set by studying a neighborhood every week, but having an investment property gives you a reason to engage in the research. Between looking for clients, processing transactions, and driving around to see homes, it can be hard to find the time to sit down and study the exact pricing dynamics of a specific market.

Would I do it Again?

Yes, I continue to be open to investing in real estate. This time, I chose to do a fix and flip. In the future, I plan to look for long-term rental opportunities to create ongoing cash flow.

I would encourage every single real estate agent to consider it as an alternative source of income or a way to build up wealth for retirement.

As real estate agents, we don’t always have access to retirement accounts that traditional employees do. Of course, the National Association of REALTORS® provides great resources for identifying and starting retirement accounts. They are definitely worth looking into.

Our experience combined with being an industry insider gives every real estate agent has an opportunity to delve into real estate investments. Just keep one thought in mind: As REALTORS®, it’s important to buy right, be ethical, and fulfill our fiduciary responsibility to our clients.

Alex Craig, a real estate professional with Century 21 Looking Glass in Lansing, Mich., helps homeowners sell their homes for maximum cash in their pocket by taking a data-driven approach and executing a systematic marketing plan that uses current digital marketing strategies. Craig also runs the Dolinski Group (, a company focused on helping real estate agents get more from their careers and earn more without the heartache.

< Prev PostNext Post >

Leave a Reply

Your email address will not be published. Required fields are marked *