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NOTABLE! Flipping cars, appliances, and other assets.

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fferro09

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May 20, 2016
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Hi Everyone,


I have never bought or sold anything for a profit, and I definitely do not want to go about doing so before doing a lot of research and asking around for advice.

I found a used, low-mileage (19,000 miles), 2012 BMW 335i with a Dealer Trade in Value (per Kelley Blue Book) of $24,000 to $27,000, and private party was even higher than that. If I can get it for $23,500 (very likely as I have been talking to the dealer selling it), would I be able to make a profit out of it? The car is in above-average condition. I checked the carfax, it has one owner, no accidents, and no issues with it. The interior looks almost new, and so does the exterior. I has been regularly serviced as well.

To summarize, these are my questions:

- Will I make a profit with these price points? Virginia taxes and tags are estimated to be $1,073
- Will I need to get a dealer license in Virginia if I'm just buying and selling one car at a time?
- Will I need to get tags for a car that I'm not intending to keep for very long?


I would greatly appreciate any advice anyone has. I've dreamed of investing for so long but never had the courage to do it. I don't have a ton of money so my margin for error and loss is pretty low, but I can afford some loss.


Thank you!
 

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Empires

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The issue with flipping cars is that it is not scale-able. And the profit you stand to make is not substantial.

My suggestion before you make any decisions is, read the book first. It will be your best investment.
 

Damage Inc.

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How is selling cars not scale-able? Texas Direct Auto started out selling cars on ebay and now does $500 million per year.

To the OP, you don't seem 100% comfortable with the risk level at that price point, why not start with cars in the $3k-$5k price range. There are a lot more people who can buy cars for cash in that price range and it might be a better way to get your feet wet with less risk and quicker turnover.
 

Empires

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How is selling cars not scale-able? Texas Direct Auto started out selling cars on ebay and now does $500 million per year.

To the OP, you don't seem 100% comfortable with the risk level at that price point, why not start with cars in the $3k-$5k price range. There are a lot more people who can buy cars for cash in that price range and it might be a better way to get your feet wet with less risk and quicker turnover.
I didn't say selling cars isn't scale-able. I said flipping cars isn't scale-able. There is a difference.
 

RHL

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I know a lot about flipping cars.

Here's my advice: Forget the car and read The Richest Man in Babylon, the world's first modern self-help book. In it, you'll learn about one of the "Laws of Gold" (AKA how to avoid being a broke scrub):

"Gold slippeth away from the man who invests it in businesses or purposes with which he is not familiar."

Basically, if you don't know WTF you're doing on a business transaction, you're going to get body bagged 99 times out of 100.

Quite a few people have messaged me asking if this car or that car is a good deal. I absolutely refuse to answer, because if you don't know how to spot and evaluate a deal on your own, you could get something valuable and still end up losing money. What if you get there and it's a flood car that's been reconditioned-you won't be able to tell. What if it's had CELs temporally disabled by an OBDII? You won't know. What if that feeling when the gear shifts isn't normal? What if it is? What if a bunch of lowballers hit you after you buy it, and nobody offers you your asking price-Did you make a mistake? Should you cut your losses?

This is not real estate, but it isn't flipping iPhones either. If you have 20K tied up in a car you can't sell with bills to pay, it gets real, real fast. I would not buy the car, and frankly, would probably avoid flipping all together. All curb-stoning is grey market, heavily taxed (especially in VA holy hell), and the government places tight tolerances even on the grey area you could hypothetically operate in without going to jail. Others are right, it's not scalable, you need a dealership to scale it out (and that'll cost you tens of thousands in taxes, bonds, and government fees in most states) and you stand to lose your shirt.

And before somebody comes in here saying, "But haven't you claimed to have made money flipping cars?"

Yes. But I never had to ask anybody for advice.
 

Damage Inc.

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I didn't say selling cars isn't scale-able. I said flipping cars isn't scale-able. There is a difference.[
I guess I don't see the difference. I buy a car for $8k and sell it for $10k. Dealership buys a car for $8k and sells it for $10k. Difference being what, that they have a building and a sales guy? Can I not buy a building and hire a sales guy? Plenty of huge businesses started out as something that a lot of close minded people would probably not see as having potential for scaling.
 

Empires

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I guess I don't see the difference. I buy a car for $8k and sell it for $10k. Dealership buys a car for $8k and sells it for $10k. Difference being what, that they have a building and a sales guy? Can I not buy a building and hire a sales guy? Plenty of huge businesses started out as something that a lot of close minded people would probably not see as having potential for scaling.
RHL already answered that really. Flipping has legal limitations. Dealers can buy and sell many cars at a time, that is scale. You can't flip many cars at a time because then you would be considered a dealer, no scale.
 

Damage Inc.

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Ah, so it is scaleable but would require some knowledge, work, and capital. Who wants to do that. Sounds like dropshipping iphone cases would be an easier path.
 

Kingmaker

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I know a lot about flipping cars.

Here's my advice: Forget the car and read The Richest Man in Babylon, the world's first modern self-help book. In it, you'll learn about one of the "Laws of Gold" (AKA how to avoid being a broke scrub):

"Gold slippeth away from the man who invests it in businesses or purposes with which he is not familiar."

Basically, if you don't know WTF you're doing on a business transaction, you're going to get body bagged 99 times out of 100.

Quite a few people have messaged me asking if this car or that car is a good deal. I absolutely refuse to answer, because if you don't know how to spot and evaluate a deal on your own, you could get something valuable and still end up losing money. What if you get there and it's a flood car that's been reconditioned-you won't be able to tell. What if it's had CELs temporally disabled by an OBDII? You won't know. What if that feeling when the gear shifts isn't normal? What if it is? What if a bunch of lowballers hit you after you buy it, and nobody offers you your asking price-Did you make a mistake? Should you cut your losses?

This is not real estate, but it isn't flipping iPhones either. If you have 20K tied up in a car you can't sell with bills to pay, it gets real, real fast. I would not buy the car, and frankly, would probably avoid flipping all together. All curb-stoning is grey market, heavily taxed (especially in VA holy hell), and the government places tight tolerances even on the grey area you could hypothetically operate in without going to jail. Others are right, it's not scalable, you need a dealership to scale it out (and that'll cost you tens of thousands in taxes, bonds, and government fees in most states) and you stand to lose your shirt.

And before somebody comes in here saying, "But haven't you claimed to have made money flipping cars?"

Yes. But I never had to ask anybody for advice.
Damn. When @RHL saves a man $20K and a whole lotta stress via a single forum post.

 
G

GuestUserX09

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You can do it but let's walk before we run. Find a cash car for 500 bucks and sell for 1k. Repeat that a few times and build up incrimentally.

I know people who buy sell cars and make full time income without much issue. Just make mistakes early with cheap cash cars. Matter of fact, only flip cars you can get with cash
 

RHL

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I buy a car for $8k and sell it for $10k. Dealership buys a car for $8k and sells it for $10k. Difference being what, that they have a building and a sales guy?
Sigh.

No.

The difference is that all curb-stoning (the technical term for flipping cars without a dealer license) is against regulations. Most states set a hard limit for the number of cars you can sell that constitutes prima facie evidence of curb stoning whether that's what you're actually doing or not. In my state and the two that border it, that number is 5. That means if you sell six cars, even if you're just blowing off items from a huge collection, you'll have to contract with an auction house or consignment dealer, otherwise you'll be charged as selling without a license and have to pay a hefty fine. Five or fewer cars per year you can usually get away with without any problem, provided that you don't sell the car on an open title. Selling on an open title is when you "acquire" a car and its title but don't sign it over into your name (and pay the taxes), and wait for the next buyer, who will pay the taxes and sign off on the title. Only dealers are allowed to pass open titles through their hands, you must pay taxes and title the car, even if you sell the car the same day you bought it, as outrageous as that is.

So here's why it doesn't scale. You have a hard limit of 5 cars that you can flip. We'll assume you're not speculating in 60's Ferraris, and are flipping cars in the $5,000-20,000 range. If you do really well, you might make about $3,000 "profit" on each car.

That's about $15,000 made on the money you put out.

But let's say that you had to buy $50,000 worth of cars (5 $10,000 cars) to make that $15,000. In VA, you'll pay $3,000 just in sales tax on that 50K. Now your profit is $12,000. Throw in maybe another $1,000 for tags on all 5, and you're down to $11,000.

Now, assume that something goes wrong with one of the cars and needs to be fixed, or you make a bad buy, a few repairs can take a big bite out of $11,000. A moderate suspension job on a BMW can be $4,000.

Ok, so you're not making a living of $11,000/yr.

What about starting a dealership?

In my state, you need a $10,000 bond ($250-1000 depending on credit) to start. You need extensive background checks. You need an office with so much enclosed space to house your cars. You need a locked government approved safe to store titles. You need a permanent land line for the business. You need a lot to show cars, so depending on where you set up, you could be looking at a mortgage of $400,000 or a monthly leasing fee of $6,000 or something. Then you need the licenses to deal, and the dealer plates, and those cost more money. Then the government has to come out and inspect everything, any delays, and your cash is out on the table but it can't work for you to earn anything.

Listen man, Please take this in the kindest sort of way possible: If you are basing your odds of making profit on KBB values and a margin of $500, you have no idea whatsoever what you are doing, and you are CERTAINLY going to lose your money.
 

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Almantas

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IMO, if you are interested in flipping cars, you should do some more research before considering investing any money at all. Then, for starters, buy a cheap car and reinvest money earned and negotiation experience gained into buying a more expensive car. By doing so, you will be able to fail quickly and cheaply and gain a lot more experience and confidence in order to purchase expensive cars.

Best of luck!
 

Dave510

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Sigh.

No.

The difference is that all curb-stoning (the technical term for flipping cars without a dealer license) is against regulations. Most states set a hard limit for the number of cars you can sell that constitutes prima facie evidence of curb stoning whether that's what you're actually doing or not. In my state and the two that border it, that number is 5. That means if you sell six cars, even if you're just blowing off items from a huge collection, you'll have to contract with an auction house or consignment dealer, otherwise you'll be charged as selling without a license and have to pay a hefty fine. Five or fewer cars per year you can usually get away with without any problem, provided that you don't sell the car on an open title. Selling on an open title is when you "acquire" a car and its title but don't sign it over into your name (and pay the taxes), and wait for the next buyer, who will pay the taxes and sign off on the title. Only dealers are allowed to pass open titles through their hands, you must pay taxes and title the car, even if you sell the car the same day you bought it, as outrageous as that is.

So here's why it doesn't scale. You have a hard limit of 5 cars that you can flip. We'll assume you're not speculating in 60's Ferraris, and are flipping cars in the $5,000-20,000 range. If you do really well, you might make about $3,000 "profit" on each car.

That's about $15,000 made on the money you put out.

But let's say that you had to buy $50,000 worth of cars (5 $10,000 cars) to make that $15,000. In VA, you'll pay $3,000 just in sales tax on that 50K. Now your profit is $12,000. Throw in maybe another $1,000 for tags on all 5, and you're down to $11,000.

Now, assume that something goes wrong with one of the cars and needs to be fixed, or you make a bad buy, a few repairs can take a big bite out of $11,000. A moderate suspension job on a BMW can be $4,000.

Ok, so you're not making a living of $11,000/yr.

What about starting a dealership?

In my state, you need a $10,000 bond ($250-1000 depending on credit) to start. You need extensive background checks. You need an office with so much enclosed space to house your cars. You need a locked government approved safe to store titles. You need a permanent land line for the business. You need a lot to show cars, so depending on where you set up, you could be looking at a mortgage of $400,000 or a monthly leasing fee of $6,000 or something. Then you need the licenses to deal, and the dealer plates, and those cost more money. Then the government has to come out and inspect everything, any delays, and your cash is out on the table but it can't work for you to earn anything.

Listen man, Please take this in the kindest sort of way possible: If you are basing your odds of making profit on KBB values and a margin of $500, you have no idea whatsoever what you are doing, and you are CERTAINLY going to lose your money.
MVP (Most valuable post) in thread.
 

Damage Inc.

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Sigh.

No.

The difference is that all curb-stoning (the technical term for flipping cars without a dealer license) is against regulations. Most states set a hard limit for the number of cars you can sell that constitutes prima facie evidence of curb stoning whether that's what you're actually doing or not. In my state and the two that border it, that number is 5. That means if you sell six cars, even if you're just blowing off items from a huge collection, you'll have to contract with an auction house or consignment dealer, otherwise you'll be charged as selling without a license and have to pay a hefty fine. Five or fewer cars per year you can usually get away with without any problem, provided that you don't sell the car on an open title. Selling on an open title is when you "acquire" a car and its title but don't sign it over into your name (and pay the taxes), and wait for the next buyer, who will pay the taxes and sign off on the title. Only dealers are allowed to pass open titles through their hands, you must pay taxes and title the car, even if you sell the car the same day you bought it, as outrageous as that is.

So here's why it doesn't scale. You have a hard limit of 5 cars that you can flip. We'll assume you're not speculating in 60's Ferraris, and are flipping cars in the $5,000-20,000 range. If you do really well, you might make about $3,000 "profit" on each car.

That's about $15,000 made on the money you put out.

But let's say that you had to buy $50,000 worth of cars (5 $10,000 cars) to make that $15,000. In VA, you'll pay $3,000 just in sales tax on that 50K. Now your profit is $12,000. Throw in maybe another $1,000 for tags on all 5, and you're down to $11,000.

Now, assume that something goes wrong with one of the cars and needs to be fixed, or you make a bad buy, a few repairs can take a big bite out of $11,000. A moderate suspension job on a BMW can be $4,000.

Ok, so you're not making a living of $11,000/yr.

What about starting a dealership?

In my state, you need a $10,000 bond ($250-1000 depending on credit) to start. You need extensive background checks. You need an office with so much enclosed space to house your cars. You need a locked government approved safe to store titles. You need a permanent land line for the business. You need a lot to show cars, so depending on where you set up, you could be looking at a mortgage of $400,000 or a monthly leasing fee of $6,000 or something. Then you need the licenses to deal, and the dealer plates, and those cost more money. Then the government has to come out and inspect everything, any delays, and your cash is out on the table but it can't work for you to earn anything.

Listen man, Please take this in the kindest sort of way possible: If you are basing your odds of making profit on KBB values and a margin of $500, you have no idea whatsoever what you are doing, and you are CERTAINLY going to lose your money.
I appreciate the reply and respect your knowledge in the field, but I do know multiple guys in PA with dealer licenses. There are plenty of guys with small used car lots making decent money, or guys who run repair shops and also deal in used cars on the side being that they already have the building and insurance etc etc. My point, that I stand by, is that you can make money flipping the 5-6 cars per year and eventually parlay the profits and experience into a dealership (and then scale from there if you have the motivation and resources). I also have a buddy who is looking into taking over the rights to a dealership (existing lot with all the gov't clearances and dealer tags etc.) because the owner is getting into another business. Selling vehicles on consignment is another way to break into the field without needing as many resources upfront (and I've done this). There are ways to get into this business and I don't understand why everybody is telling the OP to give up before he starts. I'm not claiming that the OP should buy the BMW or that he has any chances of succeeding based on what he's asked here, but you're making it sound like you have to be born into Egyptian royalty to own a car lot and I just don't get it.

Sometimes you guys are better at soul crushing than any 9-5 boss I've ever had. I'm glad I didn't find this forum before I started my business because I have a feeling if I would have posted a "should I try this" thread I would've gotten hammered into the ground.
 

Dave510

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I appreciate the reply and respect your knowledge in the field, but I do know multiple guys in PA with dealer licenses. There are plenty of guys with small used car lots making decent money, or guys who run repair shops and also deal in used cars on the side being that they already have the building and insurance etc etc. My point, that I stand by, is that you can make money flipping the 5-6 cars per year and eventually parlay the profits and experience into a dealership (and then scale from there if you have the motivation and resources). I also have a buddy who is looking into taking over the rights to a dealership (existing lot with all the gov't clearances and dealer tags etc.) because the owner is getting into another business. Selling vehicles on consignment is another way to break into the field without needing as many resources upfront (and I've done this). There are ways to get into this business and I don't understand why everybody is telling the OP to give up before he starts. I'm not claiming that the OP should buy the BMW or that he has any chances of succeeding based on what he's asked here, but you're making it sound like you have to be born into Egyptian royalty to own a car lot and I just don't get it.

Sometimes you guys are better at soul crushing than any 9-5 boss I've ever had. I'm glad I didn't find this forum before I started my business because I have a feeling if I would have posted a "should I try this" thread I would've gotten hammered into the ground.
Hey, I'm not RHL but I'm guessing he's not saying you can't profit from having a car lot or a dealership, there are tons of those around so they're clearly turning a profit. However, in the OP's situation, he wants to invest into a pretty expensive car for his first flip, has little experience or knowledge about flipping cars in general, doesn't have too much money, can only stand small losses and margin of error is low. Given all that, it's probably not wise to jump in with that BMW. A few other posters suggested perhaps he should start small, learn something about flipping and perhaps even look into what is required for a dealership, work out the numbers then decide if he wants to get in to the business seriously.
 

Jakawan

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I've flipped close to 30 cars now. And.. what I've learned is.. you make your money when you buy, and you get paid when you sell. So get it cheap!
And it takes much longer to sell a $6k+ car than a $1k-$3k car. So cash cars as earlier suggested are much better for volume and cash on cash return %.
My opinion though is if you have no long term interest.. choose a different field to put your energy and time into.. like flipping houses :)
 

Tapp001

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One way to approach the problem, based on The Millionaire Fastlane, is to ask yourself “is this car flip an event, or the result of a process?”

If you’ve been actively studying the car market, have done all your research and your homework, have made similar deals in the past, and this is the next logical step, then go ahead.

However, if you are viewing this as a single momentous opportunity, an isolated chance to make a quick buck, then I might re-consider.

I agree with what @jackawan, @Almantas, and @Square1Hype,. Try flipping a few cheaper cars to get a feel for the business without risking losing your shirt. And @RHL ‘s advice vis a vis regulations, licenses, titles, and the law sounds like it should be heeded.
 

Pure5abi

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I started flipping cars when I was 16 (22 now). Luckily for me, every deal I've done which is over 30 cars now, has been profitable. Ive made a couple hundred to 3-4k on a car. A few times I even got more than what I was asking. But how I got into it was by accident. Someone sold me a bad car when I first got my license. I later found out that it was a limited production car (I only bought it because it had nice wheels on it lol). After fixing it up, I made a few grand. After that I was hooked and started looking for deals. One thing I'll say is buy cars that have been driven by older population and buy cars that are still being driven and insured. Also look for well maintained cars. I always thought you can never flip a car if you buy it from a dealer but I've done it. you have to be know what you're buying and confident. Don't buy if you can't drive it or take it to your mechanic before hand. People who sell cars without plates are either flippers themselves, or they've encountered a problem that they do not want to fix so they end up transferring their plates to a new car(Just my opinion). Another thing is you have to be knowledgable about cars. For instance I can now tell just by seeing the make, model and mileage how much its worth. You have to be able to calculate some of the repairs in your head to set your price you want to pay. Its a pain sometimes but rewarding as a side gig. Start with low priced cars and try to flip them. Get a mechanic who you can trust that won't break your wallet incase something does come up. Message me if you have any questions.
 

illmasterj

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This will be my play job when I have retired. Except I will trade classics that I want to own. And only sell when there's something worth trading up to...
 

Camaro68

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As someone who paid for a substantial amount of his college tuition "flipping cars" here are my suggestions. Take them for what they are.

I went to school in a smaller rural community, public state college. There was a huge metro city about an hour from me. I would cruise CL day and night, seriously hours and hours a day, constantly on it and would get email notifications for postings I was interested in. You should know cars in and out, what cars are great sellers, what years, what motors are best etc. I would often buy a car from local CL, clean it up and instantly post it back on my local CL and then again on the larger metro CL. Many times I would score a quick $500 simply due to the arbitrage of things selling cheaper in the "country". Someone might ask a ton of questions and him and haw about a $2k car in my area but in the larger metro, that's a "cheap clean beater". I was also able to do most mechanical myself so I never really got into serious trouble buying a lemon. Thorough due diligence when I went to look at the car and if it needed something, I could do it myself. You should know mechanics.

This brings me to the next point. I would never buy any luxury vehicle for several reasons. The first is that, anything it needs is gonna be expensive and often require special tools (which you wont have, and probably don't want to work on). Also, you want to purchase cars that appeal to 99% of people. A small subset want Mercedes, BMW, Lexus etc. I would rather buy a Taurus to resell any day over a Saab. There is just no market for it, even if the price is totally right. You'll sit on that Saab for months or more. No thanks. Also, nobody buys their kid a Saab for a first vehicle, or a car to take to college.

Next point is price point. You want to stay in the price point that everyone can afford, and pay in cash. This is ideally below $4k asking price. I don't want to deal with them getting a loan from the bank, and people are very critical of a vehicle once they start paying "real" money for it. If there are small issues (window doesn't work, scratches, small rust if you live in a rust area etc) but in a cheaper vehicle they are willing to look over it. I would rather flip 4 cars in a month making $500 a piece than one car a month at $2k, much less risk.

Learn cars and which ones everyone wants. Camrys are great, you can move them without even trying, its also harder to find a deal on one because they are snapped up immediately if its even a half way decent deal.

Another tip, cosmetics rule all. If you live in an area with rust, or the car has dents, sun spots in the paint etc it will be much harder to move. I could have a 2005 camry that had 50k miles on it and a dented fender or some small rust spots, faded paint etc but mechanically 100% and a 2005 camry that looks mint with 250k miles on it, or say 150k miles on it and the tranny shakes or will need other serious expenses and the cosmetically good camry with mechanical issues will sell 10X faster than the bulletproof reliable 50k mile camry. People only "see" the car, they don't know about mechanical stuff. Buying a personal vehicle I LOVE the cosmetically ugly car with low miles and a cheap price because its a great deal that I can drive for years with no issues and probably sell at break even.

When you are on CL for hours regularly you start to see trends, what things are selling for, what makes/models have issues and you have numbers in your head, you know what you can get...that car is cheap! That I might be able to make some money on...

Lastly, have a fat wad of cash on you at all times (not in your wallett) but accessible and not in a bank, I cant tell you how many deals I get on a Sunday because nobody else can go get cash, but if there is a deal, I'm there within hours with CASH. That makes all the difference sometimes, being able to BUY when banks are closed after hours or Sundays. I've even convinced sellers to go with cash in hand over someone who beat me there but had to come back the next day with cash.

Start small, get your routine and rhythm down, buy a car, clean it, maybe make some cosmetic fixes that are simple, post it with good pictures, make a good write up, miles, owners, records, reliability and then wait for people to contact you. You'll meet all kinds of people, that's where your salesmanship comes in. Do you say to much? Try to sell it? Or know when to stay quiet? How do you deal with a guy trying to low ball you with an unappeasable wife? How to do negotiate with buyers who speak limited English?

Many variables in this "game". I haven't done it in probably over a year but it used to be my bread and butter. Nowdays I just cant get excited putting the extra work into it for $500-$1000. I'd rather make it much easier in my full-time day gig. But back in the day I was hustling non-stop.

I should also add, there was a niche that I knew like the back of my hand. Deals didn't come along for these as often as I would have liked, but every one I found I would make a quick (less than a week) $1500-$3000 on these vehicles. I loved them myself and knew what people wanted. I once threw the girlfriend in the car at 8pm after I got a notification on my phone of a new posting, drove 2 hours to the guys house to buy it, while I was there his phone was ringing off the hook with calls including some from 4 states over. I bought the vehicle for $4k and drove it home and put it on CL, in 3 days I sold it for $6500. That was the last deal I did a year or so ago. Easy $2500 for doing nothing almost besides driving and posting again. If you know a niche you can make money.

I honestly wish I wouldn't have sold it, I could have gotten an extra $1000 for it now, but I likely would have kept it, it was a mint ride and they don't come along often anymore in that one owner clean condition.

Good Luck
 

Camaro68

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I'll also add (not recommend) that if you license the car in your name it cuts down on profits substantially. You need to know your state laws. Keep in mind I was a hungry college kid at the time, and wasn't afraid to skirt the "grey areas".

I would buy a car and not sign the title, most people don't ask you to or watch you, they just hand you the title. Then when I sold it, I would have them sign it. They never check to see if its you on the title, they just take the title from you. In the event that they would tell me to sign it in front of them, I would tell them that I was buying it for my girlfriend or mom and it would be registered in their name so I didn't want to sign it, that always worked. If I was selling and the car was in MILDRED SMITHS name (example) and Im obviously not a 80yr old female, I would say I was selling it for my grandma, uncle, girlfriend etc. Most of the time people just don't care, it is what it is.

Again, Im definitely not advocating doing anything illegal, but at the time I was a broke college kid and this was how I was paying for school, I was hungry and it was just what I did. You learn the gift of gab. Also, in our state I think you need a dealer license for over 7 car sales a year, I was doing that in probably 2-3 months easy at my slowest. Again, Im not recommending.

I think there are certainly smarter ways to make better money, it was just all I knew at the time.

Also, you should listen to RHL, he knows what he's talking about. I would put the time/energy into something else. Had I known then what I know now, I would have been getting into the online game and probably would have done significantly better that the car gig, but I had no clue at the time. It's not easy, it's a hustle and I'm all for working SMARTER not HARDER. There are guys on here that would laugh at the work I did for a couple grand here and there while they sit at a computer and watch the account grow each month drop shipping stuff from China and never even touching anything but answering a couple emails and making some clicks. That's simplifying it, but you get my point. Direct all your time and energy into something that gives you the best return, flipping cheap cars isn't it, and attempting to flip expensive (or more expensive) cars is a good way to lose money if you don't know everything inside and out.
 

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Walter Hay

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. There are guys on here that would laugh at the work I did for a couple grand here and there while they sit at a computer and watch the account grow each month drop shipping stuff from China and never even touching anything but answering a couple emails and making some clicks. That's simplifying it, but you get my point. Direct all your time and energy into something that gives you the best return, flipping cheap cars isn't it, and attempting to flip expensive (or more expensive) cars is a good way to lose money if you don't know everything inside and out.
You have simplified the subject of dropshipping from China way too far. That flavor of the month business model is one of the worst you could consider.

The people who are involved in that line of business and watch their account grow are the ones who are selling courses on how to dropship from China - not the ones who are desperately trying to follow that faulty advice.

Walter
 

minivanman

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Being retired I've started flipping washers and dryers. I'm torn between making this a large business because there is such a call for it. Just Saturday I brought in $730 in profit and that doesn't include the other 6 days of last week. Did I know what I was doing when I started in this business? Nope, I had no clue and there is NO WAY I would have spent an ungodly amount to try it out. I spent $150.... now realize that $150 to me is more like $1.50 to most people. So I could have spent a stupid amount but why? Now that I have this business figured out I have 20 units for sale at any given time but would I have started out with 20? No. Never spend more than you need to, especially when starting something you have no clue about. If this is your 'thing', buy the $1000 vehicle and make $500 profit when you sell it. If you see that you like it, get your dealers license.

And leading in to the vehicle flipping.... a guy stopped by the other day as I was messing around with the washers and dryers and we were talking, he flips commercial vehicles. He said he bought a cherry picker for $15,000 and 63 days later sold it for $59,000. Whether it be a Honda Civic, a fork lift or a washer/dryer..... study before you buy and buy as cheap as you can to start with. Do you realize with that $20k you could buy five $4000 cars and probably make way more profit or atleast an easier profit.
 

MJ DeMarco

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Despite the OP being a one-and-done drive by, this thread has some valuable "hustle" and "flipping" advice. Marked NOTABLE and thread title changed.
 

yulthebull

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My account has been inactive for some time now and I have not posted on here for years. But this thread and topic is something that I would consider myself an expert at and here is my two cents. If you know what you are doing, which can only be gained through experience and time in the chair and feet on the ground then buying and flipping cars can and will make you a great living. Is the car hustle a scaleable industry? That depends on the individual and how fast and far they can expand their presence. Assuming that we agree that flipping cars is not scaleable, but I believe it is. The most important thing is that flipping cars if done right will multiply your investment at rates of return that you will not be able to find anywhere else. 20-30-50% or more. This money can then be invested into income producing real estate property or a tangible business interest that can generate income for months and years.

I can prove to you that I know what I am talking about but don't feel the need to want to. If you want a quick summary: We operate one of the largest wholesale operation selling an average of 100 - 120 cars per week, every week.

Hope this helps.
 

Canuker

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It's funny this thread just popped up because I've actually been flipping cars recently with good results.

I'd have to agree with RHL and say the biggest road block is the legality. I don't know how some of you have managed 30 cars with no license!

The main thing I've learned is paying a mechanic $100 to do a pre-purchase inspection can really save your a$$. Sure, it may cost you the buy sometimes. You lose out on the whole "I'll be there in an hour with $xxxx cash approach.

But unless you really know what to look for I'd say its a worthy investment.

I haven't yet tried to float a registration.

Im about to hit limit of cars which is unfortunate because if I sell my newest acquisition tomorrow (fingers crosses) I will have made $7000 this month!

It's too bad getting a dealer license is such a hassle. *sigh* Time to look for other hustles I guess. Ones that don't require all the paper work that cars do.
 

LMACK

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From my experience after buying & selling over 30+ cars I would agree that there is money to be made for the right person and the right reasons.for me I'm 25 yrs old.my dad was a mechanic and i also worked in a shop so I'm very familiar with automobiles.i can spot flaws /diagnose and repair (if needed).that made it very easy for me to maximize profits with low risk.i looked for cars that were fairly newer.low miles.in demand.that had certain flaws that I could fix easily but the normal person would have to take to the shop (ac not cold/bad breaks/dirty interior/dents etc.mainly damages caused by the owner not taking care...I would always bring my analyzer to check the engine and transmission.i note all flaws compared to the asking price and go from there..if you want to do it for side hustle and fun(like me) then yes you can make profit..

..titles&registration is the biggest BLOCKER..yes you can 'title jump' meaning the seller signs the front of the title,you leave the rest blank and pass it to the next buyer hence cutting you out of the picture.however the seller is suppose to send in a notice of transfer 'in Hawaii at least' if you fill it out with your name and they send it in to the DMV and you sell the car to someone else that may be a red flag.also if the next buyer asks you to fill out a bill of sale and you can't do that because you are not a Kimberly your a Steven so that part will get akward real fast..if you live in a small town like I do..everyone will soon notice that there is always cars on Craigslist with your number on it and you are in a new whip every other week,every day you scan the listings for deals.figure out profit margin on this,well here's a smoking deal on that..its kinda a headache dealing with all of it. if I'm going to do that I might as well do real estate deals which I'm currently in direction with
 

fastbo

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+1.

Lots of people think entrepreneurship = flipping. I didn't truly realize this fact for years. I've flipped since I was a teenager, lining up for Black Friday before people knew there was such a thing. Yes I could show up at 8am at (pick your store) and be one of the first ones in. I made a tidy little sum each BF until it went mainstream...

Flipping is arbitrage. You're not adding value. You're not creating a business. You're buying an underpriced thing and selling it for slightly more. It's incredibly difficult to scale because it depends on a constant supply of underpriced things. Buying 5 cars a year on craigslist? No problem. Try buying 50 cars on craigslist a month UNDER VALUE and see how that scales. No arbitrage business will make you wealthy unless you're able to dominate the market.

The sustainable businesses add value somehow... carmax isn't buying underpriced cars and selling it for slightly higher. They're buying cars for dealer price, making a tiny profit off the car, and making a much larger profit off the financing, warranty and service. The average car dealer makes more money off the financing than the sale price. Tip: Find the nicest car in a dealer parking lot and it'll be the finance manager's car. Not the sales manager...


I didn't say selling cars isn't scale-able. I said flipping cars isn't scale-able. There is a difference.
 

steelandchrome

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Don't have a ton to add here but I have done car flips (all collector cars), as well as buying discount items at stores and reselling for higher price on Amazon (retail arbitrage). I would agree with others that this is definitely hard to scale but can be used for fun to fill down time if you didn't have something bigger and better to work on and make a bit of cash at the same time. The classic cars were easy to buy and sell as I knew what prices should be and when I found someone willing to accept a low offer I knew I could flip for a bit more after having some fun driving them around first. The retail arbitrage was my first try at Amazon and wanted to see how easy it was to work with Amazon FBA. The RA was pretty easy to do but the FBA costs and the ability to find consistent inventory would make this again just something I would do again if the right item came up and not that I was looking for actual inventory. Any amount of flipping is good practice for your sales skills at the very least and selling skills are invaluable in any business.

Basically what I'm saying is do what you can and make money while you can as long as you enjoy it but don't plan on it being a life changing business opportunity.
 

minivanman

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+1.

Lots of people think entrepreneurship = flipping. I didn't truly realize this fact for years. I've flipped since I was a teenager, lining up for Black Friday before people knew there was such a thing. Yes I could show up at 8am at (pick your store) and be one of the first ones in. I made a tidy little sum each BF until it went mainstream...

Flipping is arbitrage. You're not adding value. You're not creating a business. You're buying an underpriced thing and selling it for slightly more. It's incredibly difficult to scale because it depends on a constant supply of underpriced things. Buying 5 cars a year on craigslist? No problem. Try buying 50 cars on craigslist a month UNDER VALUE and see how that scales. No arbitrage business will make you wealthy unless you're able to dominate the market.

The sustainable businesses add value somehow... carmax isn't buying underpriced cars and selling it for slightly higher. They're buying cars for dealer price, making a tiny profit off the car, and making a much larger profit off the financing, warranty and service. The average car dealer makes more money off the financing than the sale price. Tip: Find the nicest car in a dealer parking lot and it'll be the finance manager's car. Not the sales manager...
I agree and this is why I am between a rock and a hard spot. I'd rather cruise through the next 20-40 years years but I have the opportunity of flipping 200 (insert brand name here) washers and dryers per day if I choose to. 1 phone call gets me as many as I want as often as I want. But I agree, most often you are at the mercy of what you can accidentally find on Craigslist. And then once you find it on Craigslist you have to set up a time to go look at it and maybe buy it or maybe you will pass on it which would mean now you are running in double time to find something else to flip. But this is why most people don't continue to do it for very long.
 

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