One of the most common questions I get is whether or not you need a General Contractor license to flip houses.
I have worked with real estate investors, agents, and skilled tradesman all looking to get a General Contractor license with the goal of flipping houses.
House flipping is when an investor buys a house and then sells it for a profit.
Typically, the house is purchased and then re-sold quickly within weeks or months. There are TWO WAYS of flipping houses:
- An investor purchases a house after identifying repairs and updates that can be done to the house which will increase its value and allow it to be sold at a nice profit. The investors calculates how much it will cost in labor and materials and how much the house could be sold for. Investor buys the house, repairs it and sells it for a profit.
- Home values in a particular area are on the rise and an Investor identifies a potential opportunity where they could purchase a house and sell it for a profit later. They purchase the property and sell it a few months down the line without making any changes or repairs.
To receive an exam date with the Contractor State License Board, you must meet the following basic requirements:
- 18 Years of Age
- Valid Drivers License OR USA Issued Identification
- Social Security OR ITIN #
- Cannot Currently Be On Probation or Parole
You must also have:
- 4 Years Journey Level Experience
- Signature From A Qualifying Individual
- A Way To Prove Experience If The State Boards Asks
A General Contractor will often oversee the direct management of a job site and report to either a project manager, architect, or directly to the client.
Construction plans may be delivered to the general contractor who would then asses the scope of the project.
They would then be responsible for:
To learn more about the costs, experience requirements and examination, check out the Complete Guide to the General Contractor License!
California's laws are set up to protect the interests of the consumer. Be sure that you know what you are doing before you get involved in House Flipping.
Check out this great article from Investopedia.com that breaks down what you should know before you get started.
If you do not have any experience in construction and are looking for a place to start, check out the complete roadmap: Apprentice vs. Journeyman!