Living in Your House as You Flip It

Another topic that arises a lot in comments here and in discussions with other would-be flippers is the idea of living in a house as you flip it. That needs to be qualified a bit, though, as there’s the long term plan of flipping your own house as you live in it over years and years, and the shorter term idea of buying a property to quickly flip (usually within a timespan of months) and living there while work is done on it, whether you’re doing the work yourself or hiring it out.

It’s the second one I’m going to focus on here, as the first is pretty straightforward and touched on in the link above. As far as living in your house as you flip it, its biggest appeal is very obvious: you’re not burning money in carrying costs by paying rent or mortgage on your home in addition to the monthly interest payments on your flip property. This is especially appealing for the first-time flipper, as you’re usually not flush with capital and repairs always take longer than you think, so avoiding paying interest on a property just  sitting there empty can be huge.

That said, its pretty rare for all of the circumstances and personal situations to line up correctly to make living in a house as you flip it a feasible idea. If you’re a young, single man or woman with a high threshold for disorder, aren’t bothered by occasionally having to pee in a bottle, love having all of your belongings covered in sawdust, and enjoy living off microwave dinners for a few weeks while the kitchen demo and remodel takes place, well, step right up, you’re the perfect candidate to live in a house as you flip it.

For the other 98% of the population, well, living in a house as you flip it likely isn’t the best idea. I know it seems like a good idea but the reality is that your normal life just won’t be normal. And not to sound like a broken record, but everything (and I mean everything) takes longer than you think it will. You might work up a schedule that seems to work, as far as the kitchen remodel happening in the three days you and the wife and eight kids are at Disneyland, with the addition of the new bathroom slotted for the two days you all visit Aunt Myrtle, but that quickly descends to chaos in the real world, where such projects can drag on for weeks and weeks.

You’ll also have to account for working around whatever possessions you move in with, which is inevitable a pain in the butt and something that will slow the pace of renovation work, as far as moving furniture to paint, install trim, etc. If you’re hiring contractors, you’ll have strangers in your home, your personal abode, making lots of noise and dust and trash, on a constant basis.

But, like I said, for the right person it can definitely work. I’m very, very glad I’m married and wouldn’t change that fact for anything in the world, but when I put on the REI hat, I definitely look at properties from time to time and think “Damn, that’d be perfect if I wasn’t married and could live there as I fixed it up”. The old farmhouse built in the late 1800s that I looked at recently is a perfect example, as it needs a massive amount of work (and would at times be without electricity, heat, running water, and other “necessities”), but hell, I enjoy camping, and really don’t require much in the way of creature comforts. My wife, though, not so much, and I’d never want to be the one trying to explain to her why we were, for weeks, putting that original outhouse on the property to good use, after the nine millionth delay in getting a soil survey signed off on for the installation of the septic system.

One thing to note, though, is that all of the above is talking about buying a SFR as a flip, and the pros and cons of living in it while it’s being flipped. One of the absolute best ways to get started in flipping or real estate investing in general is to buy a duplex (or a property with two houses or a house and an apartment on it) and live in one area while renovating the other. That’s definitely much more workable for the general population, as you get the benefits of not having to burn money on interest payments for the flip property as it sits there, being flipped, but you also don’t have to give up all of the nice things about having a normal home life.

Long story short, while it’s definitely possible to live in a short-term flip project, it takes a special person to make that work, and probably wouldn’t be much fun for most folks.