Tarek is good at evaluating the risk/reward ratio for the flips he and Christina buy. Even the most awful houses tend to flip perfectly and sell for a big profit. But in “real life”, this is not always the case. If you’re a beginner pinball machine and approach a closed, rodent-infested, and water-damaged house, you’re unlikely to get a positive result. The biggest risk of flipping a house in real life is the cost. On “Flip or Flop”, there is almost never a flop. Typically, even the gnarliest houses generate a profit for the pair, no matter how small. But when you’re dealing with your own money, repairs can quickly skyrocket. This is especially true if you can’t pass an inspection, which Tarek and Christina often don’t.
Instead, when selecting a home to flip, be a lot more picky than they ever have been. Take a look at two main types of houses. The first is for older homes that need a little renovation. It shouldn’t be a house that needs a new foundation or a new roof. Instead, a home that just needs a little TLC before it meets its next owners, like a fresh coat of paint and a little lawn refinishing. The second is a home near a tourist attraction, such as a theme park, beach, or major city. You may be able to make a profit on this flip without too much work, simply because of its prime location.