People sometime ask me why I flip and don’t hold long term with all my renovations.
“You’re going to pay too much tax”
“You should be holding the properties”
In my opinion, you should be doing both because flipping gives you cash flow. And holding property will allow you to build wealth over time.
Not all properties are going to be properties you want to hold in your portfolio, so you can flip the property and realise the cash flow right away. For example, the property might not be in the right location where you want to hold, or it might be negatively geared & therefore holding might not be the best option for your circumstances.
Flipping houses provides you regular cashflow which can enable you to pull the pin on your day job.
As for the tax debate, if you’re paying tax, it means your making money, besides, you will be paying tax whether you’re flipping houses or working a 9-5.
But I agree, Ideally if you can hold as many as possible its better in the long run to build wealth.
For these reasons, I don’t think there is a right or wrong way, I think it’s dependent on your goals and current situation.
