Is Flipping Cars a Good Side Hustle - 5 Things you should know
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Author & Car Tech Expert Bio-Dave B
Hey, I’m Dave and I'm a technical writer here at PepLifestyle.com( Cars). I’m a Red Seal qualified Auto Service Technician with over 10 years experience working on Classic and Modern Cars.I've worked for Maserati, Benz, BMW, Mini, Audi, and Porsche main dealers. My passion is cars...Everything about cars....Next to cars I love Gaming and Running...
Car flipping has received a lot of attention in recent years due to its potential to help individuals locate fantastic automobiles on the resale market and earn a profit. But how good is it as a side hustle, and how much money can you expect?
Many people have started home-based car-buying and selling companies.
You don’t need a lot of money to get started, nor do you need to be an expert in mechanics (although naturally, this would give you an advantage).
How much do you adore Cars?
The question itself tells it all. The extent to which you enjoy dealing with automobiles will have a significant influence on how you feel about vehicle flipping as a side job.
If you are solely interested in making money, you may be dissatisfied, especially if you are just starting out and your windfall is likely to be tiny.
To be successful in anything in life, you must fully commit to it, and vehicle flipping is no exception.
Committing to something you despise and just do for the money, on the other hand, is a horrible experience.
If you have a passion for automobiles, the entire project will be far less tiring, allowing you to invest more of yourself into it and so have a higher chance of success.
Also Read: Is Flipping Cars worth It ?Is it Profitable or not
1. Places Where You Can Buy a Cheap Car
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Buying a cheap car is actually fairly easy. Look for cars in these places:
- Local car auctions
- Gumtree(Australia)
- Facebook Marketplace
- Craigslist
- Private cars parked on the side of the road with a “For Sale” sticker on them
- eBay
- Newspaper classified ads
- Supermarket community boards
- Facebook Car Related Groups
Considerations When Buying a Car at an Auction
- It was time to focus on the car again, so My friend brought it to his own garage and began to work. He completed the tyre change.
- After that, he vacuumed and wiped out the interior.
- He then buffed and polished the exterior of the car.
- Then he went over the engine, doorjambs, trunk, rims, and tyres with soap and water. Now the vehicle was stunning to look at.
- Ford of this vintage may sell for as little as $8,000 or as much as $9,000. It’s not worth it for him to sit around for the higher price bracket, therefore he immediately sold this car for $7,500 by placing an ad on Gumtree.
When Buying From Individuals on Gumtree, Craigslist, eBay, and in Newspapers, How to Negotiate?
Car Buying Stats
- With 30% of the vote, quality was deemed to be the most crucial element for brands in the automotive sector. Next in importance was affordability (21%), which was a crucial quality. (Brandwatch)
- 95 percent of people utilise web resources to research the best prices on cars and trucks. In actuality, two times as many people begin their investigation online as at a dealer. (ThinkWithGoogle)
- In the next six months, one-third of customers without a car aim to get one, with millennials making up 45% of this group. the EY Global
- 25% of people moved to secondhand cars in 2021, while 30% delayed getting a car. According to projections, 40% of consumers will convert to used cars by 2022, and 50% would delay their purchase. (BCG)
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2.Is a Dealer's License Required to Flip Cars?
The regulations governing how many automobiles you may sell each year differ from state to state, so you should conduct thorough study in your jurisdiction first.
In California, for example, you may only flip five vehicles per year, but in Indiana, you can sell twelve cars per year before you need to acquire a dealer’s licence.
You may get around this by approaching a licenced dealer and negotiating with him to execute the paperwork on any automobiles that exceed the state quota.
Of course, this will cost several hundred dollars, but if you’re making $1000 or more each transaction, you’re already ahead of the competition.
Another option is to use the same concept with relatives and friends, thereby depleting their annual limit before requiring a dealer licence.
Every state/country needs experienced car salespeople to register as dealers. Obtaining and maintaining a dealer licence is a time-consuming and paperwork-heavy process.
It’s also rather expensive. You should budget at least $1,700 for legal due to certificate fees, guaranty bond fees, and different regulating expenditures.
If you rent office space for your business, you must spend hundreds or thousands of dollars every month for rent or overhead.
Fortunately, small-time flippers who technically qualify as dealerships can typically get away with not formally opening up business, as long as they do not violate local regulations by blocking their backyards and roadways with extra vehicles.
Obtaining a dealership certificate is neither prudent nor prudent for casual flippers. However, if you enjoy vehicle flipping enough to build a genuine side business out of it, the business economics may work in your advantage.
The criteria for a dealership permit vary by state. In Vermont, you can sell up to twelve automobile flips each year that you own but have not registered” before you need to apply for a supplier licence (per DMV.org).
Other states have lower requirements. Before proceeding any further, contact your state motor vehicle windows registry to avoid civil or criminal sanctions for promoting automobiles without a supplier certificate.
Also Read:Is it worth selling car privately
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3. Understand Your Flip
A good car flipper never gets there without a defined end objective when flipping automobiles for profit.
The sooner you get rid of your current flip, the sooner you may start the next one—or utilise the gains to supplement your own savings.
Low-mileage, dependable sedans, waggons, and compact SUVs from mass-market manufacturers such as Ford, Chevrolet, Toyota, and Honda are among the most “flippable” vehicles in many areas.
These vehicles have a large number of potential buyers since they are well-known vehicles.
If you live in a wealthy area, it may be worthwhile to seek for undervalued luxury automobiles as well as rarer varieties of mass-market models.
Customers are frequently willing to pay a premium for them since they are difficult to come by.
However, you must ensure that your market has a sufficient number of consumers who can afford – or care enough to pay a premium for – such vehicles.
Furthermore, your region may generate unique specialised opportunities that are not available to everyone else.
In a snowy, mountainous area, you’ll have plenty of four-wheel-drive vehicles to choose from—and plenty of consumers willing to pay top dollar for them.
Convertibles will most likely come out on top in hotter climates.Places with Beaches( Florida, Melbourne & Sydney, Gold-coast) open hood or convertible would work better.
Make certain you understand your potential customers’ goals and objectives before you purchase a car since that will be difficult to market,” advises Tristan Jones, founder of Phoenix-based Mobile Vehicle Dr.
Keep an eye out for “curveball” automobiles and trucks with unique characteristics that may appear appealing.
Many customers, for example, are looking for Reliability & Safe cars, Or Luxury cars for less price( as New Luxury cars come with High price tag). Or even cool Exotic/Vintage cars to park them in their Driveway. So, there are a range of varieties available.
4. Valuing a CAR to flip
Do extensive market research on the cars worth before purchasing your first car.
Concentrate on the market you want to be in as well, whether it’s tiny vehicles, medium automobiles, or SUVs.
Only look for low-mileage vehicles in excellent condition. Avoid automobiles that have been changed in any way, such as with additional spoilers or larger-than-standard wheels.
They’re quite difficult to flip. Convertibles are another thing you must avoid. However, you should be open to considering vehicles with sunroofs.
Sunroofs are popular in hot regions, despite the fact that they may be a minefield of issues.
You must properly inspect a car with a sunroof to ensure that it is completely functioning, free of corrosion, and, most importantly, that it does not leak.
So, once you’ve decided on the sort of vehicle in which you’ll conduct your business, conduct your value study.
Current values may be found at sites such as carsales.com.au , KBB.com and Edmunds.com. They also detail the choices that were available. This is how to make money through automobile flipping.
Also Read: Should I buy a Convertible car ? Pros and Cons of owning a Convertible car.
Car Buying Stats
- 63% of new car purchasers and 61% of used car buyers both reside in suburban areas, accounting for 61% of all automobile buyers. (CoxAuto)
- Although the actual purchasing process takes place online, purchases are still frequently made offline. (ThinkWithGoogle)
- If there was an option for online purchases, 18% of car shoppers would acquire a vehicle sooner. (ThinkWithGoogle)
- 63% of new car purchasers and 61% of used car buyers both reside in suburban areas, accounting for 61% of all automobile buyers. (CoxAuto)
- 42% of respondents said they wish to handle funding online. (Cars.com)
5. Discover & Learn More About Car Repair & Maintenence
You don’t have to be an expert on everything that might go wrong mechanically.
This information will become available to you as you go. There are several books that can help you with this, but Google and YouTube are much easier.
There are many Youtube Videos to help you learn the basics of repair and car maintenance.
Going online with the proper search keywords (for example, “how to remove a radiator from a Mercedes Benz”) can immediately inform you whether you’re capable of making the repair, what equipment you’ll need, and how much it’s likely to cost.
Also, on Google, you may discover enthusiastic auto-guy forums that will provide you with valuable information on every car issue that may require repair, as well as how hard and expensive it may be. You can find out before purchasing the vehicle.
So, base your enquiry on what you know. Keep an eye out for red flags.
The following is a twelve-item checklist of probable mechanical faults you should look at before purchasing any automobile.
If your enquiry discovers issues you don’t know how to fix, you have two options: walk away or express your concerns with the seller as a means of negotiating a lower price.
Prior to flipping- Things your need to know
Having a keen sense of the market is the first step in successfully flipping an automobile, enabling you to purchase low and, ideally, sell high.
Start by checking the value of the vehicle you wish to sell in price guides like Edmunds and Kelley Blue Book. Here are a few more pointers from the professionals to help you determine whether flipping is risk-worthy.
- Verify that the car you’re thinking about purchasing doesn’t have any penalties or restrictions on selling it.
- Think about whether the money you hope to earn is worth your time and effort.
- In case the music suddenly stops and the market finally cools off, pick a car to flip that you wouldn’t mind owning.
- Obtain price quotes from online auto dealers including Carvana, Shift, Vroom, and CarMax.
- Calculate all fees and the cost of any necessary repairs to the vehicle.
- If you want to resell a used automobile, look for a well-kept model with few owners, low mileage, and low mileage.
Final Thoughts
Making Money From Car Flipping:
Even if you love automobiles for their own reason, when it comes to flipping them, you just have one aim in mind: to make a lot of money.
How likely that is and how you can go about doing so will be determined by the type of automobiles you sell and your strategy to flipping.
SUVs and family cars, for example, have a large market.
Flipped SUVs on the resale market are a great windfall for families that can’t afford pricey SUVs or just choose to spend their money elsewhere.
Targeting those individuals with your own SUVs is an excellent approach to profit on a natural market demand.
Because they aren’t overly showy, these automobiles are frequently affordable to acquire and flip, costing only a few thousand dollars on your end.
On the opposite end of the scale, some people have a strong desire for luxury or vintage automobiles.
However, new models in the former situation may be prohibitively expensive, while old ones in the latter case may be difficult to locate.
In any case, if you can obtain and flip luxury or vintage automobiles while also finding people ready to pay for them, you may be in for a big pit!
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Author & Car Tech Expert Bio-Dave B
Hey, I’m Dave and I'm a technical writer here at PepLifestyle.com( Cars). I’m a Red Seal qualified Auto Service Technician with over 10 years experience working on Classic and Modern Cars.I've worked for Maserati, Benz, BMW, Mini, Audi, and Porsche main dealers. My passion is cars...Everything about cars....Next to cars I love Gaming and Running...
Apply for Auto Loan/Personal Loan and Get your Car faster than you think!
