Can you make a living "flipping" cars?

I see many cars on Craigslist that are perfectly good aside from one major problem, usually a head gasket, or a transmission. Every so often, it needs minor rust repair, and a good vacuuming and washing.

Here are the steps in my head- rent a small shop space. Get a post lift, tire-changing equipment, a welder, an air compressor, and expand my tool collection a bit. Get an old diesel truck and a trailer to tow non-runners.

Buy a car, get parts of out the junkyard or buy re-manufactured, clean 'em out, do an oil change, top off fluids, maybe change a couple tires, resell for $2000-$4000 more. The criteria for selecting which cars to "rehab" would probably be something like no frame damage or no crashes at all, not older than 15 years, no Chevy Citations or original Kia Sportages- so in other words, cars that would be reliable anyway, etc etc.

I haven't crunched numbers yet, but I think I can be at least slightly profitable doing this. I don't need to make lots of money...I don't lead an extravagant lifestyle, and I'm used to making not a lot of money, only currently it's while working horrible HORRIBLE hours. And I could always consult the GRM braintrust if I run into a problem.

Do you think anyone would buy a car from someone who does this for a living?

My race budget comes from refurbished Neons and building rool cages. There is some money to be made there, but overhead will kill you. If you can do the work out of your home, that will make the difference.

There seems to be a dealer here who specializes in Saturns.
Consistency of fixing known issues and swapability of plastic body panels for easier bodywork as well as hiding the rust.

My point being to find a brand and stick to it.

If you got good at GM manifold gasket replacement you could have an endless flow of cars.

I think supplemental income = yes

The sole means of making a living = very very difficult.

And remember Craigslist sellers aren't always known for full disclosure.

Hungary Bill wrote: I think supplemental income = yes The sole means of making a living = very very difficult.

It depends, as stated, if you have a seperate garage you can do the work in, I'd disagree.

You need to know your costs and the value you get from a car though. Minimum $500 net profit per car is my budgeting. That'd be 6 cars per month and I'd earn more money than I currently do. There's been the odd time where I've pulled off $1500 net on a car that cost a total of $1500.

Considering when I was 16, I could do about one a month (relying on borrowing people's trucks/trailers) it is very easy.

It is much better as a supplemental income though.

Depending on where you live, you may have to be a dealer if over x amount of cars.

Michigan is 5 cars, then you must become a licensed dealer with a storefront.

If you had no shop space rental and more tools, I would say yes. Those two things will kill you. Instead of the diesel truck and trailer, how about a used tow truck and you might make some easy supplemental money towing cars. A guy down the road does this, and is He had a tow truck and some shop space. Before too long, a steady flow of cars were going in and out. He flips everything from muscle cars to camrys. The muscle cars sit for a little longer, but every time this guy touches a Jetta, it is for sale for less than a day. I havent seen him ask more than 6k for anything, so I have no idea what his profits are.

Grtechguy wrote: Depending on where you live, you may have to be a dealer if over x amount of cars. Michigan is 5 cars, then you must become a licensed dealer with a storefront.

True, they call it "curbstoning", but I know of people that have done it for years and the state has never bothered them. There's also the option of having the seller sign the title over without filling in the "buyer" portion, then just don't register the car in your own name, just hand the signed title to the person buying the car from you. That way the state doesn't know you ever owned it. IMO, that's probably illegal, and I've never done it myself, but I have heard of it.

If "Wheeler Dealers" is to be believed, I think it would be tough to get the ratio of work to profit to be good enough to make it worthwhile. Granted, it's a TV show, but I think there is some truth to that notion. Of course, that doesn't stop me from wanting to do it myself, since I already have a truck, trailer, a nice shop, and a bunch of tools......

Here's how I'd make money.

Buy a E36 M3load of motorcycles in the fall. Fix them over winter. Come spring, sell them all for huge markup, or offer the chance to trade for snowmobiles. Trade UP. WAY UP to snowmobiles. Also, buy snowmobiles in spring and fix them over summer.

Come fall, you know what to do.

I don't think I could make much money selling snowmobiles.

For that matter, bikes wouldn't work either. In GA you can ride year round, so there is no price drop in the Fall.

When i was in college i did 12 in year all the profit went out with one bad buy. Without a dealers license to forgo taxes and secure financing it is hard. It can be done. Just hard.

Best to leave it as a supplement than a sole source of income

To the OP: This is what I plan to do when I retire. If you're thinking about doing it as a business, screw the lift, welder, etc. Keep the overhead low, and remember, just like anything purchased to "flip," the profit is in the purchase price. Keep your purchases ~scrap value, and you can't lose.

Hell, I have a buddy (retired) who does "will buy junk cars" ads in the newspaper. Makes good CASH scratch, and doesn't even bother parting the cars first. I've seen him crush some E36 M3 that made me cry, but he rolls 'em through fast.

Grtechguy wrote: Depending on where you live, you may have to be a dealer if over x amount of cars. Michigan is 5 cars, then you must become a licensed dealer with a storefront.

^^This^^
Most places require you to have a dealers license if you sell more than x amount of vehicles a year and the number is usually 5 a year. Cost of dealers license and now you have a license it would be reported income for taxes would eat the profits up in a hurry. Not even mentioning the hassle of where you are going to run this business from, limitations and other legal ramifications to do it out of your house/garage and then you'll have more overhead cost of a place. Might as well just open a used car dealership.

I think most people wouldnt survive trying to make a living that way, maybe a single guy with access to a family members shop or garage could make it work, but I don't think you could support a family that way. OTOH, I think it could be decent supplemental income. Sticking with one brand thats popular and in demand locally would probably be smart and economical. It could be beneficial to be known as the local (insert brand of your choice) guy.

Having dealers license may not be a bad thing. Many years ago, a friend of mine had a cousin who owned a body shop and happened to have a dealers license.

When he would go to the dealer only auctions he would often take my friend and bid on cars for him. He got, and fliped alot of cool cars that way. He did 6 or 7 a year and usually made 2k per car, one rime he got a Lexus with minor crash damage, fixed it with j/y parts and made $5k. For a kid that was a bit special and couldn't hold a normal job he did alright. (Today they would probably say he had Asbergers syndrome, back then it was called really wierd kid).

i think about doing this a lot, and if you think about scrap values and parting out alone, you really can't go wrong with buying any car in the $LeMons/Chump Car to $GRM Challenge range.

wlkelley3 wrote:

Grtechguy wrote: Depending on where you live, you may have to be a dealer if over x amount of cars. Michigan is 5 cars, then you must become a licensed dealer with a storefront.

^^This^^ Most places require you to have a dealers license if you sell more than x amount of vehicles a year and the number is usually 5 a year. Cost of dealers license and now you have a license it would be reported income for taxes would eat the profits up in a hurry. Not even mentioning the hassle of where you are going to run this business from, limitations and other legal ramifications to do it out of your house/garage and then you'll have more overhead cost of a place. Might as well just open a used car dealership.

If the title's never in your name, how does the state track it?

Obviously it's possible to make a living doing this if you have a dealer's license. After all, that's exactly what a dealer does Look into what's involved in getting a license in your area though - I'm pretty sure Colorado requires you have an actual place of business, not just your driveway.

Doing it as a personal thing will involve a bit of risk, of course. You'll have to pick a car that's worth something when it's fixed, so it's probably best to stay away from 1989 Buicks and their ilk - even if you do think they're cool. You'll want cars that are quick and easy to liquidate. I agree that it would be easiest to be a specialist in a certain car, in part because you'll get a reputation.

I was aware of the dealer license thing, I think that is true in PA.

There is a guy in Manheim (about 50 minutes from where I am) that specializes in Saturns as well. Maybe I should just get a job there. I've had three (four if you count the one I had for 3 weeks before junking) and I've done essentially everything there is to do

It occurs to me I could be a lot more profitable (and look more professional) if I had an ASE cert., which I don't.

I know nothing about motorcycles, so not so much. I do know it's cheaper to buy one in the fall, though, we have that price-drop thing here.

Doing the work here is out of the question. I live in an apartment that is one-quarter of a large old farmhouse, so there's other people here, there's no garage, and the driveway is gravel.

The reason I've got these entrepreneurial ideas in my head is that, long story short, myself and the other brewers at the brewery are getting boned HARD when it comes to shifts. Trying to reason with the management isn't getting us anywhere. I would just quit and open my own brewpub, which has been a goal of mine since I knew what a brewpub was, but I (and everyone else) had to sign a non-competition agreement when I was hired.

There's no money in music (my degree), I can't use what I know about beer, and I know fixing cars. Hence the post.

Sorry, long rant.

Grtechguy wrote: Depending on where you live, you may have to be a dealer if over x amount of cars. Michigan is 5 cars, then you must become a licensed dealer with a storefront.

In NC, it's 3 per year. And you must have a storefront, actual business address in the proper zone, and the cars have to be on the lot on that address.

Twin_Cam wrote: The reason I've got these entrepreneurial ideas in my head is that, long story short, myself and the other brewers at the brewery are getting boned HARD when it comes to shifts. Trying to reason with the management isn't getting us anywhere. I would just quit and open my own brewpub, which has been a goal of mine since I knew what a brewpub was, but I (and everyone else) had to sign a non-competition agreement when I was hired.

Non competition clauses are almost impossible to enforce. Check you state labor laws to even see if it is legal.

if you feel like relocating, i'm in pittsburgh. i could open the brewpub, and "hire" you as whatever position you can hold on paper until your non-disclosure runs out, and when it does you'd officially just own half the pub?

Truthfully, not really. I'm sure some areas and some situations might be different, but in a word, no.

If you have a brother who has a weekly empty bobtail run that goes from NV to OH, you might be able to flip some rust-free classics, but otherwise its a losing game.

I grew up in Carlisle, PA (home of the largest swap meets on the east coast) and lived for a while in Los Angeles. I tried a few spring runs of some rust-free stuff from CA, NV, NM, AZ, etc to the spring Carlisle show. I was able to barely make my money back.

At best, I am known for buying stuff cheap, driving it for a year, and selling it for what I paid. These days with internet knowledge and ebay, finding that super steal is a rarity.

Heck, even used car lots are having trouble finding junk to spit shine and make a couple c-notes these days.

mrjoshm wrote: if you feel like relocating, i'm in pittsburgh. i could open the brewpub, and "hire" you as whatever position you can hold on paper until your non-disclosure runs out, and when it does you'd officially just own half the pub?

That's a sweet offer, but Mrs. Twin_Cam is currently doing the "second career" thing at a local college, and really doesn't want to move. Plus I could never root for the Steelers

I'll look into the non-competition thing. I would also have to find out if any other local breweries are hiring, but I think one is. Sierra Nevada and New Belgium were both looking into building East Coast plants near Philadelphia, but they both (!) chose Asheville, NC instead.

I Am Keyser Söze wrote: When i was in college i did 12 in year all the profit went out with one bad buy. Without a dealers license to forgo taxes and secure financing it is hard. It can be done. Just hard. Best to leave it as a supplement than a sole source of income

I really only gave it a go for about a year. I wasn't making very much to begin with and I got in over my head with a Volkswagen Rabbit. It was enough to talk me out of flipping cars again.

Then again, I was working out of a rented garage spot, in my apartment complex, with the most basic set of hand tools imaginable.

Good times.