Greg Gaudet is a real estate investor who recently got super lucky with a Hawaiian property he bought.
Since purchasing the house in 2022, its value has increased by a whopping $600,000. Though he bought the house to sell it to the highest bidder, Gaudet is now considering holding the property as a money-spinner.
Playing a Fluke in Paradise
Gaudet’s star home is located on the beautiful Hawaiian island of Maui. In 2022, the property was valued at $855,000. However, it needed some notable repairs.
So, 39-year-old Gaudet bought the house off the buyer’s hand and spent an extra $25,000 for the necessary upgrades. Gaudet’s efforts paid off beyond his wildest dreams.
Rolling Up the Sleeves To Pan for Gold
After completing renovations on his Maui buy, Gaudet found, through an official appraisal, that the house was now worth $1.5 million.
Gaudet told a news outlet that selling the Maui property is out of the question, at least for now. Just by holding on to the property for two years, he claims the house has made him $600,000 on paper.
Just Another Casual Investor
Before buying the Maui house, Gaudet only tried to fiddle with his loose cash. However, he now works full-time at Maui Home Buyers and earns a minimum of $5,000 monthly for renting out his renovated house.
So, Gaudet no longer sees real estate investing as a side hustle but as a mainstay that could make him a big-time millionaire.
Can You Trust Your Gut?
Just before buying his Maui property, Gaudet had a gut feeling that it would soon become a money-maker. However, the profitability of his purchase was more of a lucky streak than a calculated risk.
Around the time of the purchase, all the factors in the real estate market seem to have agreed to align in his favor.
How the Stars Can Align in Your Favor
First off, there was an over 12.8 percent increase in new listings on the real estate market. Likewise, mortgage rates remain high, hovering around 6.8 percent.
Unfortunately for home buyers, flooding of the real estate market by new listings does not automatically translate into price reductions. These are some of the reasons why Gaudet got a much higher valuation for his 2022 purchase.
The Prepared Are More Prone To Luck
Gaudet himself couldn’t help but admit that he was simply lucky with the timing of his purchase. Why? If he had held off buying the Maui house in 2022, the price would still have skyrocketed even without the necessary renovations.
However, he still has his gut to thank because he just knew after getting the offer that the house would be a great buy.
The School of House Flipping
About his success in real estate investment, Gaudet explained that two important factors he looks out for are the property price and its cash flow.
In essence, he means the investment must either generate recurrent income after the purchase or generate a tangible return after resale.
High-Demand Locations Are Easy To Sell
According to Gaudet, a real estate investor is likely to get high returns on a property in a choice location for buyers, even when it requires major renovations.
Most realtors avoid the trouble of investing extra cash in renovating a property after coughing up huge sums for the initial buy, so that becomes the sweet spot that most house flippers tend to exploit.
Pay Someone To Do the Hard Work
Gaudet explained that he leveraged the renovations. All he had to do was spend a couple of hours finding a contractor who was up to the task of restoring the property to pristine condition.
However, he explains that there’s more to house flipping than those things he has mentioned.
Pay the Price of an Expert
Rookies are likely to make rash decisions, so Gaudet recommends taking it slow and learning the market dynamics before plunging headlong.
A new real estate investor does not want to lose or tie down their savings by making an unlearned move or buying. So, learning some level-headedness through experience is essential for a budding house flipper.
Plan for the Worst, Expect the Best
Gaudet offers one more piece of advice: sit down to objectively predict the future of a property long before you buy it.
According to him, it is foolhardy to buy a property because the price is reasonable, and I pray that you get to sell it off at huge profits without doing your homework.
Leave Only Small Margins of Error
A property investor needs to run the numbers and see that the buy would be profitable from the get-go. When an investor pays all the necessary prices of success and leaves a very slim percentage to chance, their success rate naturally climbs.
This is exactly what Gaudet did, and he is enjoying his fair share of financial freedom for his sacrifice.
Masters Are Trained, Not Born
Success in house flipping is not a genetic trait, meaning you can as well learn it. Gaudet is not the only real estate investor to testify to noteworthy success in recent times.
There is the story of Blake Busson, who quickly grew to start his own company, Busson Home Buyers. He also started by house flipping.
Rinse and Repeat
Busson’s first profitable buy was a property located about 45 miles north of Los Angeles. He bought the house for $730,000 and spent another $108,000 on repairs and upgrades.
Busson eventually sold the property for $1.02 million just a week after renovations. To increase his net worth, Busson simply reinvested his profit in new purchases.