flipping vehicles for profit

[Chris142]

my wife and i need more income. so we discussed buying cars that need work ,fixing them and selling them at a profit. but im scared of getting in over my head. so I started small. I have bought a 1989 yamaha blaster quad. I got a good deal on it and it does run and is currently registered. But it needs a lot of little things. I've spent 3 days trying to get the carburetor properly tuned. some clown had the jettong and float level all screwed up. I went to adjust the chain and a chain is too long. So I had to cut the chain .

then I find out that the chain adjuster does not work backwards. It's a major operation to move the rear axle forward to get the chain adjusted correctly. I finally got the carburetor working pretty good went for a test ride and the throttle cable broke!

I can already see that flipping cars is not for me!

 

[actionstan]

I have considered it too.. in my area you can find Saturn's with non-working transmissions for 500-700 dollars. If your lucky and find a junk yard transmission that is working they are only 2-300 I could flip the car and sell it for 2000ish. But... You never know what else you are going to run into... So far I haven't taken the risk... Come this fall I'll have a bit of extra money.. so we shall see..

 

[Chris142]

ya i dont want to buy a car and it ends up needing $2000 in cats to pass a smog test before i can sell it

 

[occupant]

Keep it simple, only buy/sell cars that are too old to need smogged. Poor you in California...

Laws are different in different states so make sure you find your loopholes before the state ties one around your financial neck.

For example in Texas, you can only sell four vehicles per year before they require you to get a dealer license (and the requirements range from reasonable to ridiculous). But in Texas they only consider vehicles 24 years old or newer to count towards those four. Get a niche working with 80s GM G-body coupes, 60s Cadillacs, Datsun Z-cars, four eyed Mustangs or 73-87 C/K pickups and sell as many as you want.

 

[Chris142]

the smog thing is why i went with the atv first. not required on those.

 

[eljefino]

My state has a five car per year limit before the dealer license thing, but if you have the car registered in your name for six months this doesn't count towards the quota. Plus a person could borrow their wife's name or convince a seller to keep the title open so it was never "yours".

Dealers here have to fix cars that won't pass safety/emissions inspection within 72 hours, while a private party can sell as-is. One can pass inspection just before sale. It's transferrable and a selling point-- as well as a buying one if a car fails.

The gold mine is someone freaking out and selling their clunker after getting a quote for all new brakes over one seized caliper, new quick struts on an axle or all around when one corner has a bad strut that'll take a junkyard one, etc.

Chris might do well taking something common to him like an 80s monte carlo from his rust free paradise, road tripping it to the northeast, selling it, and flying home. Or at least have his vacation partially paid for.

 

[paulo57509]

Chris, a co-worker of mine had a similar idea. But he lived in an apartment at the time and didn't have any work space.

So he started doing the same thing with bicycles in one of the spare bedrooms. He sources full bikes and parts bikes off of Craigslist, fixes them and sells them for profit.

The bicycle market might not be as big in Apple Valley as it is in San Jose but maybe apply the strategy to something similar (small risk/investment).

I admit that I have thought about the car/motorcycle/rec vehicle/lawn mower flipping thing as well.

 

[eljefino]

The nice thing about cars vs ATVs is you can always find someone who NEEDS a car. Plenty of idiots on CL trying to trade their Xbox, ATV, boat, gun, goat, etc for a running car. These are the folks you want to deal with as they have poor impulse control and get redneck toys when the getting is good and need your car when the getting is bad. Trade a running car for a (half broken) ATV plus cash, then flip the ATV.

 

[SteveSRT8]

You must have at least above average mechanical skills, and ESPECIALLY diagnostic skills, in order to successfully flip cars for profits.

Me and my son have done this since he was 9, and he has made a lot of money this way. CLEAN is a big part of it if you want top dollar. And of course you must buy smart.

The net has made this a viable project for anyone willing to take the risk and spend the time...

 

[demarpaint]

Originally Posted By: SteveSRT8
You must have at least above average mechanical skills, and ESPECIALLY diagnostic skills, in order to successfully flip cars for profits.

Me and my son have done this since he was 9, and he has made a lot of money this way. CLEAN is a big part of it if you want top dollar. And of course you must buy smart.

The net has made this a viable project for anyone willing to take the risk and spend the time...


+1 I'd look at newer and better cars that need less work, if you can afford to. That's what I'm considering doing.

Several years ago my brother and I did it a few times, along with boats and outboard engines. He is a very good mechanic though, and we bought things we knew could be easily fixed. The money was good, especially in the outboard engines.

 

[Pop_Rivit]

That sounds like a lot of work for very little profit. Unless you get lucky, given the amount of time invested you may be lucky to work for minimum wage. To top it off you have to deal with both buyers and sellers.

The only way I can see it making any real money is if you find a niche market in your area. Beyond that it will most likely be a hobby that generates very little profit.

There are a lot of ways to make money without spending your time dealing with junk vehicles.

 

[oilmaven]

Back in the 90's I flipped a lot of cars...and made a lot of money doing it. I would find a relatively clean vehicle at a good price and check out the brakes, tires, etc. Any safety-related repairs were made and a quick detail of the interior/exterior. Used car prices were reasonable then and deals were to be had...haven't done it in years because of the current high used car prices...not many deals out there unless you want to invest in repairing/rebuilding...too much time and risk for me. Pity, I had a blast doing it while it lasted.

 

[Donald]

Originally Posted By: Chris142
my wife and i need more income. so we discussed buying cars that need work ,fixing them and selling them at a profit. but im scared of getting in over my head. so I started small. I have bought a 1989 yamaha blaster quad. I got a good deal on it and it does run and is currently registered. But it needs a lot of little things. I've spent 3 days trying to get the carburetor properly tuned. some clown had the jettong and float level all screwed up. I went to adjust the chain and a chain is too long. So I had to cut the chain .

then I find out that the chain adjuster does not work backwards. It's a major operation to move the rear axle forward to get the chain adjusted correctly. I finally got the carburetor working pretty good went for a test ride and the throttle cable broke!

I can already see that flipping cars is not for me!


Flipping vehicles is basically what the used car jockeys do for a living buying cars at auction. But they also have a business so people will pay more than a private party sale.

I tried to buy broken pressure washers for $25 to $50 and throw in a new pump and sell. I made money on the first one but not a lot.

If you put a value on your time as far as finding/buying, fixing up and then selling, you may not make as much as you hope.

 

[IndyIan]

How about lawn tractors? Lots of the cheaper hydrostat ones used a K41 tuff torq, that isn't really that "tuff" at all and starts losing power once they warm up. Many just need a few parts inside or even just a fluid change for higher hour units to get them running well again.
Typically dealers won't repair them, just quote $1k for a new HST and then try to sell a better mower.
Google it, one guy has posted step by step instructions on how he resurrected his mower.

 

[eljefino]

Originally Posted By: Pop_Rivit
That sounds like a lot of work for very little profit. Unless you get lucky, given the amount of time invested you may be lucky to work for minimum wage. To top it off you have to deal with both buyers and sellers.


I have a friend who worked one afternoon and evening on a car and profited $500+ selling that car to a waitress who worked all summer to save up for it. Beats minimum wage.

The trick is to buy from a "non-car-guy" who just wants it gone. They're out there.

Stick to what sells-- boring commuter sedans, work trucks. If you can predict a gas price crunch stock up on 90s saturns.

Of course if you come to depend on the income from the 2nd gig, it then becomes a job and not fun. If it's for pin money it's different.

You might have a lot of competition from undocumented people who can't get day jobs and will lie and cheat and skip on their taxes... dealer groups call this "curbstoning" to make themselves smell like roses in comparison.

 

[Mud]

TV shows make it seem like it's easy money.
Unless you know what you're looking at and have the resources to do whatever level of repair/refurbish is needed the path can be rocky.

 

[Pop_Rivit]

Originally Posted By: eljefino
Originally Posted By: Pop_Rivit
That sounds like a lot of work for very little profit. Unless you get lucky, given the amount of time invested you may be lucky to work for minimum wage. To top it off you have to deal with both buyers and sellers.


I have a friend who worked one afternoon and evening on a car and profited $500+ selling that car to a waitress who worked all summer to save up for it. Beats minimum wage.

Your single datapoint is the exception rather than the norm, which is why you elected to point it out. You failed to point out (assuming he does this on a regular basis) the number of times your friend did little more than break even. Amortize that over a year and my point of working for little more than minimum wage is still valid.

If your example could be repeated on a weekly basis it may be worthwhile, but your example is an anomaly and therefore not terribly relevant for the original poster, especially given that the original poster has already discovered the pitfalls of "flipping" vehicles.

 

[rshaw125]

Getting a dealers license can be very beneficial. You can attend dealer only auctions and also get a dealer tag. I know dealers who will buy a car at an auction for someone and add a few hundred for the service.

 

[SF0059]

You can count on getting burned if you are flipping cars with mechanical issues beyond a tune-up. The best way to make money at flipping is to purchase cars with noticeable but correctable cosmetic issues. A little elbow grease detailing and touching up can make you some easy money even if your margin of profit isn't as good.

Another method for flipping, one that I have used, is to buy under valued classics. Do your research on what is up and coming in the custom car scene. Then stay on the lookout for cars in a farmers field or an old lady's garage. Make them a low offer and flip it to someone who knows the value. I've done that with 4 Studebakers, several old Dodges, etc.

 

[eljefino]

Originally Posted By: Pop_Rivit
Originally Posted By: eljefino


I have a friend who worked one afternoon and evening on a car and profited $500+ selling that car to a waitress who worked all summer to save up for it. Beats minimum wage.

Your single datapoint is the exception rather than the norm, which is why you elected to point it out. You failed to point out (assuming he does this on a regular basis) the number of times your friend did little more than break even. Amortize that over a year and my point of working for little more than minimum wage is still valid.


Don't put words in my mouth, you don't know me or my buddy. Just checked with my friend and he comes out ahead more than 80% of the time, which beats playing the stock market. His day job cut back on OT so he has the time and energy. What he makes boils down to a different amount of man-hours per car, and different profit per car or per hour, but it keeps him happy, occupied, and seems to beat his day job.

I have to imagine that if he owned a shop and had pressure to pay rent and insurance every month it'd be more stressful.

To the OP and anyone interested, invest in what you know. The stock market is played out; any idiot can put money in and any sheister can inflate a stock's value over the short term. If it's old studebakers or ten-year old tauruses, if you've flipped a couple you know what to look for when buying, and how to shine a creampuff so it stands out from the crowd.