Hi everyone,
I learned a few things from my car flipping days that I feel relate to website flipping. Here they are in order of my experience...
Don't get emotionally involved in an auction listing - This comes from my first car purchase when I was 16 years old. I actually really loved the idea of buying a car off of Ebay because I saw that they were being sold for what I thought were great deals. I had a job so I knew what my price range was, and I had a great idea for what kind of car I wanted.
I found THE ONE. It was a running 1987 Honda CRX that was going for less than $500 with a little over a day left. I watched that listing like a hawk. I couldn't sleep that night because I was too busy imagining myself inside it and how I would feel like driving it. I was in LOVE.
By the time the auction had 10 minutes left the car was going for just $600. Want to know what I ended up paying for it after I went into a bidding war? $1350. Had I stuck to a strategy and not let my emotions run the show, I could have won that bad boy for less than $700.
Do your homework There was a fantastic public auto auction only a 15 minute drive from my house in Denver. I loved going there to test drive the cars, figuring out potential profit margins, and just hanging out. I'm like a cop in a donut factory being there.
Anyway my first car flip purchase was a great looking wagon that had low miles, ran smooth and strong, was clean, and was a very good price. I confirmed it's KBB valuation and I bought it for $1200 on the spot knowing that I had at least $3500 in profit margin to play with. Or so I thought... It turns out that the car was made by that oh so unfortunate Korean manufacturer Daewoo. Let's just say the buyers market wasn't that hungry.
Luckily I was able to still sell it less than a month later for a profit of $300.
Learn as you go I decided that I would learn my lesson from that close call and play it safer but bigger my next go around. This time I found a 2000 Toyota Celica GT with 125k miles that was pretty beat up for $3000. I knew it needed some body work and a little engine work but that I could sell it for at least $5500 or more in good condition (similar cars were selling for more at the time on craigslist) I bought it on the spot knowing its potential.
I ended up putting $1300 in repair work over the next month, got to drive around a fun little car, and sold it for $5600 cash for a profit of $1300.
Later, I ended up buying another slightly more expensive car at the auction - a 6-speed 2004 Audi A4 - which I dreamed of having as a kid. My wife and I loved driving it for a year and we sold it for what we paid for it.
The whole point is that while flipping cars and websites may seem tricky, it may seem risky, it may seem like hard work - it's all about going about it with the right mindset. It doesn't have to be any of those things.
Being able to recognize a good deal when you see one, understanding the marketplace and the profit margin your working with, and learning from your experiences (meaning you actually have to take action) is the name of the game. Have fun and happy flipping!
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Originally Posted by bluey4
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