Flipping Houses vs. Rentals – Which Should You Be Doing?

A common question I get asked is “Todd, do you flip houses OR do you do rentals?”

And the answer is yes!  Lol.  I do both of those things!

But what they’re usually really asking me is, “Do you do one OR the other?” …as if you can ONLY do one OR the other.

Also I know that a lot of times that question comes from the fact flipping houses is far more glorified, both by gurus and in the media.  Whereas, on the other hand, buying and holding rental property, and being a landlord often gets a bad rap.

It’s easier for gurus to sell courses on the more glamorous subject of flipping houses, if they scare everybody away from the “big, bad” rental properties by saying that, “Being a Landlord is a lot of work, hassles, and headaches, blah, blah, blah.”

I love being a landlord because I love cash flow!  Call me crazy, but I love having that consistent, semi-passive income… coming in every month like clockwork!

Now for a certainty, there are challenges with rentals, such as evictions, dealing with problem tenants, maintenance, etc.  The key is to get educated on how to run your rental properties like a million-dollar business (even if you only have one), and not like a hobby.

I’ve flipped a lot of houses, and I love doing that, too!

So I love flipping houses AND I love being a landlord.  I love BOTH because BOTH bring money into my bank account, to support the life of my dreams, and to help me do my part to make the world a better place.

The problem with flipping houses, though, is that once you flip the house, then the question is… what do you have to do to get paid again?

You know, you get that big, fat profit check, and then guess what? You don’t have any more money coming in!  So once you flip the house, and the house is gone, you’ve got to go out and flip another house to get paid again!

When you have a rental property, i.e. a property that generates you monthly cash flow or (semi) passive income every month, then that’s like the goose that laid the golden egg, right?

That rental property golden goose just keeps on laying those eggs every month, and those little golden eggs hatch and deposit into your bank account!

So in the case of flipping houses… we’re talking about buying a house, working with contractors to fix it up, and putting it in mint condition.  Then we’ll put the house up for sale on the market at a much higher price than what we bought it for, with a huge profit built in for us.

We’re going to sell that property to an owner occupant who wants to live in the property and make it their home.

It’ll take a little time to get the buyers for your house qualified with their mortgage lender, get their loan approved, etc.  But once they get through that process, you’ll get your one big pot of gold at the end of the rainbow!

So again, once you fix-and-flip that house, you get one big, fat paycheck vs. on a rental property, you get smaller monthly paychecks every month.

Now, those aren’t the only strategies I use. Unfortunately, those are the two strategies that most people know the most about, which is why they ask me that question.

There’s also Wholesaling.  You may have heard of this, or even done some of it, as there are a lot of courses and gurus teaching that now.  In Wholesaling, you buy a property (usually a fixer-upper, but not always) at a low price, and then you sell it at a slightly higher price without fixing it up.

Then we have Lease Options, where I’m going to control the property on a lease with an option to buy.  Then I’m going to have the right to sublease it to a Tenant/Buyer (T/B).  I’m also going to give my T/B the right to lease it and buy it from me, at a higher rental amount and purchase price than what I’m paying my seller.

I’m going to have a monthly profit on the rental cash flow spread, and I’m going to collect some money up front from the T/B as a Non Refundable Option Consideration (NROC). Then I’m also going to sell the house to my T/B for a higher sales price than what I negotiated to pay my seller.

So all in all, Lease Options give me three (3) different ways to make money on the same house that I don’t even own!

Another buying strategy that I use is “Getting the Deed”, aka “Subject-To”, or “Taking Over Payments”.  With this strategy, I can make money on the house by turning it into a regular rental, or I might sell it as a Rent-To-Own, or I could sell it on a Land Contract.  As you can see, I have several different ways to get paid using this strategy as well!

Then there’s “Seller Financing”.  With Seller Financing, I’m basically making the seller my bank.  I’m not going to the bank to get a loan… in fact I never go to the bank to buy a house for investment.  So if I can make the Seller become my bank on a house that I’m buying, then at that point, the sky’s the limit!  I can negotiate anything I want that I can get the seller to agree to!

I can negotiate low monthly payments with the payments that I’m making to the seller.

I can negotiate zero interest.

I can negotiate quarterly, or biannual payments… or no payments at all for a certain period of time.

There are literally all kinds of things I can do with Seller Financing, such as… land contracts, purchase money mortgages, subordination, etc.

With Seller Financing, we can even mix and match combinations of all the other strategies that I’ve already talked about in this article!

So as you can see… I’ve got all kinds of financial weaponry in my house-buying arsenal.  I’m not just doing the common, conventional things that people hear about fixing and flipping, being a landlord, or even wholesaling.

So, yes… I DO flip houses, and I DO buy and hold rentals… and tons of other things that I do to pump more money into my bank account… and, more importantly, I can personally teach you all these strategies to pump more money into YOUR bank account!

Ready to step up your game?

Check out my step-by-step real estate investing courses for both beginner and advanced investors.

Are you looking for a 1-On-1 real estate investing mentor? 

Check out my Monthly Coaching and/or Hourly Consulting Programs.

A common question I get asked is “Todd, do you flip houses OR do you do rentals?”

And the answer is yes!  Lol.  I do both of those things!

But what they’re usually really asking me is, “Do you do one OR the other?” …as if you can ONLY do one OR the other.

Also I know that a lot of times that question comes from the fact flipping houses is far more glorified, both by gurus and in the media.  Whereas, on the other hand, buying and holding rental property, and being a landlord often gets a bad rap.

It’s easier for gurus to sell courses on the more glamorous subject of flipping houses, if they scare everybody away from the “big, bad” rental properties by saying that, “Being a Landlord is a lot of work, hassles, and headaches, blah, blah, blah.”

I love being a landlord because I love cash flow!  Call me crazy, but I love having that consistent, semi-passive income… coming in every month like clockwork!

Now for a certainty, there are challenges with rentals, such as evictions, dealing with problem tenants, maintenance, etc.  The key is to get educated on how to run your rental properties like a million-dollar business (even if you only have one), and not like a hobby.

I’ve flipped a lot of houses, and I love doing that, too!

So I love flipping houses AND I love being a landlord.  I love BOTH because BOTH bring money into my bank account, to support the life of my dreams, and to help me do my part to make the world a better place.

The problem with flipping houses, though, is that once you flip the house, then the question is… what do you have to do to get paid again?

You know, you get that big, fat profit check, and then guess what? You don’t have any more money coming in!  So once you flip the house, and the house is gone, you’ve got to go out and flip another house to get paid again!

When you have a rental property, i.e. a property that generates you monthly cash flow or (semi) passive income every month, then that’s like the goose that laid the golden egg, right?

That rental property golden goose just keeps on laying those eggs every month, and those little golden eggs hatch and deposit into your bank account!

So in the case of flipping houses… we’re talking about buying a house, working with contractors to fix it up, and putting it in mint condition.  Then we’ll put the house up for sale on the market at a much higher price than what we bought it for, with a huge profit built in for us.

We’re going to sell that property to an owner occupant who wants to live in the property and make it their home.

It’ll take a little time to get the buyers for your house qualified with their mortgage lender, get their loan approved, etc.  But once they get through that process, you’ll get your one big pot of gold at the end of the rainbow!

So again, once you fix-and-flip that house, you get one big, fat paycheck vs. on a rental property, you get smaller monthly paychecks every month.

Now, those aren’t the only strategies I use. Unfortunately, those are the two strategies that most people know the most about, which is why they ask me that question.

There’s also Wholesaling.  You may have heard of this, or even done some of it, as there are a lot of courses and gurus teaching that now.  In Wholesaling, you buy a property (usually a fixer-upper, but not always) at a low price, and then you sell it at a slightly higher price without fixing it up.

Then we have Lease Options, where I’m going to control the property on a lease with an option to buy.  Then I’m going to have the right to sublease it to a Tenant/Buyer (T/B).  I’m also going to give my T/B the right to lease it and buy it from me, at a higher rental amount and purchase price than what I’m paying my seller.

I’m going to have a monthly profit on the rental cash flow spread, and I’m going to collect some money up front from the T/B as a Non Refundable Option Consideration (NROC). Then I’m also going to sell the house to my T/B for a higher sales price than what I negotiated to pay my seller.

So all in all, Lease Options give me three (3) different ways to make money on the same house that I don’t even own!

Another buying strategy that I use is “Getting the Deed”, aka “Subject-To”, or “Taking Over Payments”.  With this strategy, I can make money on the house by turning it into a regular rental, or I might sell it as a Rent-To-Own, or I could sell it on a Land Contract.  As you can see, I have several different ways to get paid using this strategy as well!

Then there’s “Seller Financing”.  With Seller Financing, I’m basically making the seller my bank.  I’m not going to the bank to get a loan… in fact I never go to the bank to buy a house for investment.  So if I can make the Seller become my bank on a house that I’m buying, then at that point, the sky’s the limit!  I can negotiate anything I want that I can get the seller to agree to!

I can negotiate low monthly payments with the payments that I’m making to the seller.

I can negotiate zero interest.

I can negotiate quarterly, or biannual payments… or no payments at all for a certain period of time.

There are literally all kinds of things I can do with Seller Financing, such as… land contracts, purchase money mortgages, subordination, etc.

With Seller Financing, we can even mix and match combinations of all the other strategies that I’ve already talked about in this article!

So as you can see… I’ve got all kinds of financial weaponry in my house-buying arsenal.  I’m not just doing the common, conventional things that people hear about fixing and flipping, being a landlord, or even wholesaling.

So, yes… I DO flip houses, and I DO buy and hold rentals… and tons of other things that I do to pump more money into my bank account… and, more importantly, I can personally teach you all these strategies to pump more money into YOUR bank account!

Ready to step up your game?  

Check out my step-by-step real estate investing courses for both beginner and advanced investors.

Are you looking for a 1-On-1 real estate investing mentor? 

Check out my Monthly Coaching and/or Hourly Consulting Programs.