By committing to sell the flip to my clients before we even closed on the purchase ourselves — which I describe in Part 6 of this series — two opposing forces were instantly created:

1) We could relax, knowing that we needn’t spend any time, money, or energy marketing the property. We had the buyer under contract, the price agreed, the closing date set. Boom, Done!

2) But… at the same time, we had the home’s owner-to-be now [heavily] involved in the project. With the stroke of a pen on the contract, our “flip for maximum profit” had just morphed into a “custom remodel.”

When we still thought we were flipping the house, Tyler’s and my plan was to shop the budget-bin at the local flooring outlet, pick a funky-but-not-beat-up front door from the ReStore, and keep tabs on the clearance rack at Home Depot for plumbing fixtures and bathroom vanities.

Not only is that the boot-strappers/budget-minded approach to maximizing profit on a flip, it’s also kind of fun! It’s like treasure hunting: you never know what you’ll find, and you might stumble across some real treasures!

On top of that, the value we were proposing to infuse into this house was not the most luxurious finishes, fixtures and design elements. The ‘value’ we knew would make it sell lickety-split was that is would be 100% clean and 100% done!

Clean and done. Those are hot items in the Columbia-neighborhood starter-home market.

But with each passing day on the jobsite, our notions of what “might’ve been” were swept away with the sawdust, and we got deeper and deeper into accomodating the deeply-contemplated material and design choices of the buyers.

Logistically it worked like this: On an Excel spreadsheet, Tyler and I had listed every element of the remodel we planned on doing, and we assigned each job and/or material choice a dollar-value. With that in hand, the buyers could choose to upgrade any item as long as they paid the difference.

Simple, right?

Not hardly, so we learned. It’s not like we had a building-materials equivalent of the Taco Truck pulling up to the front curb every day. With each new change we had to go out and chase down those materials, negotiate prices, comparison shop and so on. That all took time, and took us away from the jobsite OR the RE/MAX office, where we were trying to keep our businesses running.

And the extra bookkeeping took time. The communication with the buyers took time. Finding specialty subs to install specialty materials took time.

Time is money. Loss of time is loss of money. Loss of money is loss of profit. You get the picture.

Let me pause to make special mention here that the buyers for our flip could NOT have been better to work with. They sensed our maybe-not-too-subtle regret at choosing to pre-sell the house, and they did a world-class job at staying patient with us. I credited them then, and I credit them now.

But take my advice: If you’re itching to try a flip, think very, VERY carefully about pre-selling when you know — objectively — that you’re working with a hot property in a hot market, as we were. In fact, I’ll just come right out and say it: “Don’t do it.” I for one would try to avoid pre-selling ever again.

Tell your buyers, if you really like them, that you’ll give them first right of refusal when the project is DONE. But do NOT give up control of your project, its design, its finishes, its colors, etc. Our decision to do so, and I’m sure Tyler would agree, was absolutely, positively……..

To be continued…