HOUSE FLIP: It's DEMOLITION TIME | Real Estate Investing, Home Remodeling, Construction (2023)


If you want to learn about flipping houses for beginners, real estate investing, home remodeling and first time house flippers, this video and this channel is for you!

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We are Sam and Eddy, high school friends turned business partners, starting our journey of flipping our first home. This is everyone's favorite part where we demo EVERYTHING (almost everything). Demolition is stress reliever and it also signifies the start of something new. The problem with demolition is that it takes energy, effort, planning, and preparation to do it properly. Watch us go through the preparation steps required to make the demolition a breeze. Oh and the fun part, we break things down!

If you enjoyed this video about flipping houses for beginners, real estate investing, home remodeling and first time house flippers, please remember to like, share, subscribe and comment if you have any questions, suggestions or feedback. We hope to see you here again soon!

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So so, hey guys we're back and it's demo time the last video you guys saw was actually taken about four or five months ago.

So it's been a pretty long mission to get here.

We got eddie here from seattle.

What's up and uh we're gonna start demoing today, so the trucks, the the cranes and everything are coming in a little bit and they're gonna demo, the whole house, I'm gonna, go over all the things that change all the things that we had to do to get to this point: asbestos testing, temporary fence, temporary power, water spouts.

All these different things we're going to kind of go over it.

How much we ended up spending on the actual demo, how we picked the person that was going to do our demo for us, because it's not as easy as you think, as well as how much we paid for all the other stuff going on like the fence portal, potty permits temporary power.

How much all that costs? It's a lot of money! Guys it's a lot more than you expect so eddie! Why don't we tell them about the port-a-potty and the fence? Why we needed it, how much we spent and how we got it because we're demoing the whole house we'll need a bathroom here for the construction guys working.

So we bought our portal potty.

It costs about 30 bucks to drop it off, you're, going to clean it once a week, and it's going to cost us about 155 a month for keeping this here, the entire time we have it here, then the fence, you got it for 550, we're renting it for six months, and then it gets prorated after that, our fence is about, I think, 120 feet, so they charge you by the foot.

The other thing that was interesting is the building on these is a 28 day cycle.

So it's not a full month.

We also ended up getting the fence and toilet from one company and then a temporary powerful, which we'll show you right now we got from a different company and I'll tell you why, in a minute, all right we're at the temporary power pole eddie once you tell them how much we paid for this thing we paid about 600 to get this installed.

With this electrical box, they had to hand dig the hole that cost us about 75, which is pretty cheap.

Other places were charging us almost a thousand dollars, so we found this company.

We got this in here for about six hundred dollars for six month rental.

On top of the rental, we had to pay dwp to actually disconnect the power from the house and connect here, and that was an interesting 1 000 100 100, I guess, is a deposit that they're going to give back.

So it's basically about a thousand bucks.

We also paid department, building and safety about 150 bucks for their permits to make sure that this was all put in place.

The right way, if you think about it, it's just a regular six by six treated piece of wood.

That's 20 feet long.

You probably buy this for like 150 bucks at home depot, but all these special requirements and stuff that you got to do and it was just it- was easier to rent it and get it over with not have to worry about, not hiring electrician.

To put it set it all up, so we got the temporary fence to toilet the temporary power.

All we needed was to shut off the gas cut.

The water line from the front of the house do an asbestos test, and then we can start demoing.

So let's talk about asbestos.

So as far as asbestos goes, nobody knows what's going on um, we figured it out because a couple of contractors asked us about it and we figured out.

We have to do the asbestos test, which is monitored by air quality management department aqmd, but there's literally no information on it's very hard to find information on it.

What I learned through my hours and hours of research is, you need to get it done on houses before you, demo houses you need to get it tested, make sure there's no asbestos or lead or anything got to get it tested.

So you're not polluting the air when you're demoing the house, so we got it tested.

Eventually, we called a bunch of different companies out here, someone at three four thousand.

We ended up getting it done for about 1200 bucks, even though this house was built in 1940, we discovered that there was very minimal asbestos.

As a owner builder, we are able to remove the asbestos from the house if it's under 100 square feet, so we went ahead and we got that removed and we disposed of it properly.

So the demo guys should come in here and wipe everything out and don't have to worry about it.

So we're going to talk about what's being demoed and what's staying here, so basically we're demoing pretty much the whole house, the one wall, we're keeping.

Is this one right here? So the demo guys came in here? They separated this wall.

They braced it and that's separate from, the house the reason we're keeping that wall is for setback purposes.

Because the house was built so long ago.

The new rules don't allow us to get that close to the wall, to the property line.

So now, by keeping this wall, we're able to keep that distance from the property line instead of bringing the house closer in which gives us more square footage on the back end.

Also, keeping this wall in place justifies this as a remodel instead of a new construction which saves us on linkage, fees so we'll do a whole another video about the permit process, architecture and all that, but one of the things that we learned there's a thing called a linkage fee, which is basically meant to help homeless.

People find housing.

It is 12 dollars a square foot on your entire build so on 2400 square feet that was going to be around what 30 grand.

So in order to avoid that we had to keep this wall so the build date is still going to.

Show 1940 but it's going to.

Be a completely brand new house, except for about 10 feet of wall, all right, I'm on the sidewalk in front of the house right now- and this is the temporary water spot that they put out.

Basically, they cut the line, the main line going to the house, and they put this little water spout on it connected to a hose, and it's basically used as water to bring down any dust debris or anything that flies up while they're demoing the house that way the entire neighborhood isn't covered in dust.

It's a very easy thing: it cuts the rest of the house off from the water, so we don't have to worry about pipes, exploding and the denver guys went ahead and did that for us.

So so we had to stop the videos because the demo guys showed up and they destroyed everything in about two hours: they're hauling everything out right now, as far as how we decided our demo crew or who we're going with for demo.

It was fairly simple.

We reached out to people that we knew in the industry that had references.

We got them to refer a few people to us.

We got everyone out here to give us quotes and we based it on pricing, their experience in the job and how fast they were willing to perform the work.


These guys had multiple references from the guys that we knew we heard about them from different places.

We still talk to other people, it's important to talk to everybody, to talk to multiple contractors, these guys price-wise.

They were on point experience wise.

They were on point and they had references if you guys want to know exactly how much we paid for the demo of the house, the hauling of the trash and the grading that's going to go on next week, subscribe comment down below and stay tuned, because next week we're going to talk about exact numbers and how much this all cost us.



What is the 70% rule in house flipping? ›

Basically, the rule says real estate investors should pay no more than 70% of a property's after-repair value (ARV) minus the cost of the repairs necessary to renovate the home. The ARV of a property is the amount a home could sell for after flippers renovate it.

Is it a good time to flip houses 2023? ›

Flipping houses has been extremely profitable for the past decade, but 2023 should see the market tightening up quite a bit. With demand sagging, rehab costs going up, and days on market doubling or even tripling, house-flippers have a little tougher path to profitability than before.

What is the flip house rule? ›

Put simply, the 70 percent rule states that you shouldn't buy a distressed property for more than 70 percent of the home's after-repair value (ARV) — in other words, how much the house will likely sell for once fixed — minus the cost of repairs.

What is the timeline for flipping houses? ›

The speed at which you flip a house has a big impact on how much money you end up making in the deal. Simply put, the shorter it takes, the more money you are likely to make, provided you complete high quality renovations. As a very broad rule of thumb you could say: 3-6 Months – Highly experienced house flippers.

What is the 90 day flip rule in real estate? ›

If you plan to purchase a flipped home with an FHA loan, you must abide by the FHA 90-day flipping rule. This rule states that a person selling a flipped home must own the home for more than 90 days before home buyers can purchase the property.

Does flipping a house count as income? ›

The standard tax consequences of flipping a house, where you own the property for less than 12 months, is that the profit you make is subject to your standard taxation rate. This is due to the fact that the IRS classes any investment you own for less than a year then sell for a profit as 'normal income'.

What are the risks of real estate in 2023? ›

Continued inflation, overall higher interest rates, a potential recession and geopolitical tensions will force 30-year and 15-year mortgage rates up throughout 2023, and will bring the two rates closer together as short-term risks rise,” says Dennis Shirshikov of real estate website

Where is the best place to flip houses in 2023? ›

Top 5 Cities To Flip Houses In 2023
  • 1) Atlanta, GA. Atlanta is a top city for flipping houses due to its growing economy and increased housing demand. ...
  • 2) Hartford, CT. ...
  • 3) El Paso, TX. ...
  • 4) Jacksonville, Florida. ...
  • 5) Charlotte, NC.
Mar 13, 2024

Is 2023 a good time to invest in real estate? ›

Despite what some may think, 2023 is still a good year to invest in real estate, thanks to advantages like long-term appreciation, steady rental income, and the opportunity to hedge against inflation. Mortgage rates are expected to decline, but the housing market is likely to remain competitive due to low supply.

What is illegal house flipping? ›

A con artist buys a property with the intent to re-sell it an artificially inflated price for a considerable profit, even though they only make minor improvements to it.

What is the hardest part about flipping houses? ›

What is the hardest part of flipping a house? Finding the right property (at the right price), budget management and unforeseen structural issues are often considered some of the biggest challenges that house flippers will have to face.

How much money does the average house flipper make? ›

Home-flipping returns by state
State2022 Flipping Gross ProfitPercent Change in ROI
45 more rows
May 8, 2023

Is house flipping high risk? ›

It's a high-cost and high-risk investment,” Schroeder said. “Even experienced house flippers often witness success rates below 50%. If you run into prominent issues like cracked foundations, mold, termites and broken water pipes, you could witness significant financial losses.”

Is flipping houses still a good business? ›

The profit per flip in California may not be as high of a percentage as in some other states, but California flippers can still make a substantial profit. The average flipper in the state had a gross profit margin of about 16% and a profit of $92,500 in 2022.

How do I avoid capital gains tax on a flip? ›

This provision means that if you reinvest capital gains into a QOZ fund and leave it there for at least ten years, you will not owe taxes on the gains you earn from the investment. You will still owe the tax on the original amount you invested (deferred until 2027) but not on the profits accruing from the reinvestment.

Why is house flipping illegal? ›

It involves buying a property and then reselling it for more money. Usually, when someone flips a property, he or she makes repairs and improvements beforehand. It can become illegal if the person falsely represents the condition and value of the property. This equates to fraud, which carries serious consequences.

What is a good profit on a house flip? ›

How much profit should you make on a flip? On average, a rehabber shoots for a 10 to 20% profit of the After Repair Value, but it varies depending on the market and the specific project risks. A 10% profit would be on the lower end, and a 20% profit would be considered a 'home-run' by most rehabber's standards.

What is the rule of 70 formula? ›

The rule of 70 is used to determine the number of years it takes for a variable to double by dividing the number 70 by the variable's growth rate. The rule of 70 is generally used to determine how long it would take for an investment to double given the annual rate of return.

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