Flipping houses for a living is a real trick
By Pat Curry • Bankrate.com

You come home from a long day at work and while channel surfing, you come across a show in which guys are buying run-down houses, fixing them up and reselling them for huge profits before the first mortgage payment is due.

Wow. What's more, they claim they make as much money on this one house as you have in the last year.

They don't look or sound any smarter than you are and they're raking in the cash. You start crunching numbers and before you know it, you're thinking about a career change.

Before you quit your day job, can we talk?

It's not as easy as it looks on TV. The price run-up of the past few years led thousands of people to reach the same conclusion you have. There is a boatload of competition out there, which means that the obvious deals are gone in a heartbeat. The pros will tell you that they make their money on the front end by buying properties for at least 30 percent below market value. Finding those houses takes time and once you find them, you'll need to move fast. And no matter what the late-night gurus say about doing this with no money down, it hardly ever works that way. That means you'll need access to cash to do the deal, not to mention the rehab.

Dream catchers
"The masses believe in the dream that's been promised to them, that they'll be making a fortune in the next six months," says Manuel Iraola, president of Miami-based Homekeys.net, an online real estate company. "They don't have the basic know-how. If it were as easy as they make it seem, 286 million people would be flipping real estate."

Richard C. Davis, owner of Charleston-based Trademark Properties, and creator and star of A&E's reality show, "Flip This House" says no one can watch his show and get the impression that this is an easy way to make a living.

"In our original video, we had a warning," Davis says. "'Do not try this at home. It's for trained professionals. You will lose money.' I got two guys following me around with a camera. There are no scripts. If I lose $100,000, you see it."

While he understands the desire of people to get in on the action, he doesn't have a lot of sympathy for people who don't want to invest the time that's needed to learn the business.

"Right now, you have people jumping in on frenzy and it will bankrupt a lot of Joes and Susies who have no business doing this," he says. "I mean, my wife is a doctor, you don't see me going out doing heart surgery."

Here's the catch
What's there to learn? Atlanta-based financial adviser Bill Kring wishes people understood that they need to have adequate savings in place to pay the bills while money is flying out the door for cabinetry, plumbers and plants.