Hear a gripping tale of a disastrous out-of-state real estate flip that turned into a valuable learning experience. Explore the unexpected costs, like skyrocketing property taxes that can derail profits, and the struggles of managing properties from afar. Travis shares insights on the unpredictability of market timing and emphasizes the advantage of long-term holding. Discover practical advice for novice investors, including the importance of local knowledge and reliable property managers. It’s an engaging mix of personal stories and actionable tips!
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question_answer ANECDOTE
Out-Of-State Flip Turned $30k Loss
Travis recounts a Dallas flip that turned into a nightmare due to unforeseen contractor costs and out-of-state management issues.
The $50k remodel ballooned to $72k and the deal ultimately produced a ~$30k loss shared with his dad.
volunteer_activism ADVICE
Don't Flip Remote Markets Without Local Help
Avoid flipping properties out of state unless you have trusted local partners and deep market knowledge.
Visit markets, walk neighborhoods, and verify contractor bids before committing to remote projects.
question_answer ANECDOTE
Rented To Stop Holding Losses
After poor market reception and high hard-money interest, Travis rented the house via a local property manager to stop bleeding cash.
The rent barely covered mortgage and manager fees, so it became a small monthly loss while they sought refinancing.
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In this episode, Travis shares a personal story about his experience with a challenging out-of-state real estate flip that resulted in a significant loss initially, but also valuable lessons for long-term investing and property management. He discusses the complexities of managing properties from afar, unexpected costs like property taxes, and the emotional factors that influence buying and selling decisions. The episode also covers practical advice for navigating real estate investments, including the importance of local market knowledge and having trustworthy property managers.
On this episode we talk about:
The risks of out-of-state real estate investing and the need for trusted local support.
Unexpected expenses like property tax increases after ownership transfer.
How market timing can be unpredictable and the value of long-term holding.
Strategies for managing rental properties, including using mother-in-law suites and Airbnb for supplemental income.
Emotional aspects of real estate decisions versus logical financial planning.
Practical tips for those new to real estate investing, especially regarding boots-on-the-ground knowledge.
Top 3 Takeaways
1. Out-of-state real estate investing demands extensive local market knowledge and trustworthy management to mitigate risks. 2. Unexpected costs, such as increased property taxes, can drastically affect profitability. 3. Long-term holding of properties often outperforms attempts to time the market, especially with a reliable tenant paying the mortgage.
Notable Quotes
"Better research could have avoided a lot of this loss—I didn’t know what I didn’t know at the time."
"You can’t time the market; buy real estate and wait—it will be worth more in the future."
"If you can afford it, holding properties even without a tenant can be like putting money into a savings account that grows."
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