My Story Flipping Craigslist Used Cars For sale And Making $125 Per Hour
Throughout the years, I have become very familiar with the Craigslist Used Cars for Sale website. While in college I used Craigslist to sell vehicles for a profit. Each month I would visit the local DWI auction and pick up a handful of cars for under $1000. Thanks to my upbringing around cars, I was able to diagnose and fix any problems these vehicles had. The majority of times repairs were rather inexpensive, which was great news for a car flipper.
At the time, I had a couple 0% introductory credit cards that came in handy when purchasing these used cars. The auctioneer accepted major credit cars so I was able to borrow money for a short period of time for free and use the cards to purchase needed auto parts. Within a couple of days these cars would be cleaned up and ready to be advertised.
Back then, the magic formula was simple:
Maximum Bid = (book value/2) – Cost of repair – Tax & Title
By using this formula, I would always double any money that I invested within a month. Best of all, the invested money didn’t actually belong to me, it belonged to the bank and I was using it interest free.
I used this winning formula for several years while in school were able to earn a little extra money for booze. Armed with my Kelly Blue Book, I would attend these auctions and determine which vehicles that I wanted and which ones I would pass on. All factors would be taken into consideration including the cost associated with repairs, purchase price, and title cost. Here is a list of car registration fees in Florida I would weigh this against the book value. It may also be smart to factor in an additional 20% to account for negotiating loss. You want your buyer to walk away feeling as if they just got a really great deal. Knowing this, I build the negotiation cost into the price.
3 Steps to Double Your Money Buying Craigslist Cars
1. Inspect each car at the car auction and determine what needs to be repaired. If you are familiar with auto repair, estimating auto parts and time should come fairly naturally. If you are not, bring you mechanic along to assist you with this step. All problems may not be immediately noticeable but this is the risk that you take. Worst case scenario, you will have to sell your car at a break-even price if it has a major problem. Write down the estimated amount that all repairs will cost.
2. Get an idea of how much the car tax and title fees are going to be. This amount will vary depending on which state that you live in. Before going, it would be a good idea to contact the Department of motor vehicles and ask about vehicle tax and title charges. Most states base this amount off of the book value of the car or total selling price. Once you understand the vehicle fee structure in your state, you can quickly come up with a ballpark figure. Once you have arrived at a number write it down.
3. Look up the book value of the vehicle. While the Black Book comes in handy, many car buyers like to use the Kelly Blue Book or the Nada. Get value estimates from both books in addition to estimates from websites such as Autotrader. Come up with an amount that you believe the car is worth in running condition. Write down this figure.
For example, lets say you are looking at a 1997 Chevy 1500 Silverado ½ ton 4×4 work truck with a 5.7l 350 engine automatic transmission. This truck is in fair shape and has 125k miles on it. You notice that the power steering hose is leaking and the fuel pump is making a loud humming sound. From experience, you know that the truck will likely need a fuel pump in addition to a power steering pressure hose. The hose cost around $50 while the Fuel Pump is $200. It will take you about 4 hours to do both jobs. All together you have $250 in parts plus 4 hours of your time.
After contacting your local DMV you learn that tax and title cost just over 2% of the book value of the car. After determining the book value to be $4000, you quickly determine that the taxes will cost you $80. In your state the title work cost $40. Combine, tax and title come out around $120.
Plug all of these numbers into the simple magic money making formula:
Maximum Bid = (book value/2) – Cost of repair – Tax & Title
Maximum Bid = ($4000/2) – $250 – $120 –
Maximum Bid = $2000 – $250 – $120
Maximum Bid = $1630
Simply write down $1630 with the corresponding information on your vehicle sheet. Repeat this process until you have inspected every car on the lot. Depending on which auction you attend, you could be looking at several hundred cars. Knowing this, come early and come prepared. Bring plenty of liquids to keep you hydrated, snacks and sun block. Don’t forget to show up several hours before the auction begins to inspect each vehicle.
When the auction starts, bid on each car that you have listed. Some cars you will get some you will lose. Don’t get discouraged if you are outbid. You will still likely drive away a couple cars. After the auction ends, take home your winning cars and prepare them for to list on Craigslist Used Cars for Sale. I like to use Craigslist Cars Miami Florida when I am selling Cars in South Florida. Likewise, if you are trying to sell a car in Charlotte, try Craigslist Cars Charlotte NC.
Preparing Your Cars to Sell on Craigslist Used Cars for Sale
First and foremost you will need to take care of any problems that need to be addressed. It’s okay to leave small problems but the major ones have to be fixed or you may have one unhappy buyer on your hands. At first glance, take note of all things that stand out. Does that rear-view mirror dangle from the headliner? Glue it back up on the window! How about that sun visor that will not stay up? Replace it with one at the salvage yard! Speaking of salvage yards, it is a great idea to find a few nearby. While you may not put salvage parts on your personal car, they work great for Craigslist Cars.
Remember that Fuel Pump and Pressure hose? Now is the time to replace this.
Once all major broken items have been repaired or replaced, it is time to clean up your car. One thing is for sure and that is a clean car sells much better on craigslist cars. Here are a few items that you will want to pay close attention to while detailing the car.
• Clean under the hood. Nothing sells a car better than a clean engine. For some reason car buyers believe that if an engine is clean on the outside, it must be a good car. Take it to the car wash and have the engine steam cleaned. Be sure to cover all electrical components as they can become damaged during cleaning. After the engine has been cleaned, allow it to dry and spray a vinyl protection spray or tire shine on all rubber hoses and non metal parts (except of course the belts)
• Detail the inside and out, paying close attention to all of the nooks and crannies. In this case details count. Clean the windows with newspaper and Windex. Use a buffing compound to remove oxidation from the paint and finish the job with a good soft wax. I like to throw in a neutral air freshener to cover up any odors that may exist.
• Clean the tires and rims very well. There is one thing that people like and that is good looking tires and rims. Use a wheel cleaner to remove brake dust and use a tire cleaning solution to remove the brown stuff from the tires and make them look new. After your wheels are dry, finish them off with a high gloss tire spray
• Get the car ready for Craigslist. Wait until a nice sunny day and take picture of the interior and exterior of the car. Take pictures of features such as power windows or power locks. Also, take close up pictures of the tires.
Creating an Ad on Craigslist Cars That Will Result in Success
Now that the vehicle is ready for sale, post it on Craigslist Used Cars for Sale. A simple one liner ad will not do in this instance. An effectively written ad will generate many more leads than one posted with no thought. What does it take to create an advertisement that results in success?
Be As Descriptive As Possible
Nothing is more attractive then a well written advertisement. Include everything from make, model, engine size, transmission, features, mileage, and any other positive features. Here is an excellent example of a well written advertisement:
1999 Chevrolet 1500 Silverado ½ ton pickup truck – Beautiful truck $3995 Orlando
I am selling my 1999 Chevy 1500 Silverado ½ ton pick up. This has been a reliable truck and has never had any major problems. The following items have been replace in the past 5 years
• Power Steering Pump
• Fuel filter
I am the original owner and have performed routine maintenance on this vehicle. It has a 5.7 L 350 engine with automatic transmission. In addition, the truck has all of the power features including locks, windows, seats, mirrors. It comes with a premium sound system and features ice cold AC and hot hot heat. Only 125k miles makes this truck a real bargain.
Call 407-555-1212 Craig
Keywords: Chevrolet truck, Chevy truck, Chevy 1500, Chevy Silverado, Chevrolet Silverado, Chevrolet 1500, Chevrolet pickup, pick up truck, ford f150, ford truck, ford pickup, ford pickup truck
There is an advertisement that will grab some attention. Notice the random keywords that I placed at the bottom. These can be very helpful to draw in those who shop for Craigslist Used Cars for Sale by Keyword. Notice that I also included the Ford F150 tuck. It is a good idea to include similar models because shoppers may interested in one particular model and consider yours because they like the price and or features.
Include Lots of Pictures
Here is one trick that very few people take advantage of. Upload a couple dozen pictures to a picture hosting website such as Photobucket. Once uploaded, you can simply copy and paste the HTML code into your advertisement under the written ad. Although Craigslist Cars prohibits embedded Youtube videos, there is a way to insert video while complying with the rules. I will explain this in a later post.
Create a Youtube Video
Picture may be worth a thousands words but a video is worth a million. Use a quality camera and shoot a short video of the truck or car you are trying to sell. Offer a link in the advertisement where viewers can click to see. Be sure to include a link back to your as in addition to your contact information. Youtube can be a great marketing technique that produces results. I like to title my videos something like Craigslist Cars Orlando Florida.
How to Post An Embedded YouTube Video On Craigslist Cars
I know of course that the first thing that comes to mind is that you can not embed a YouTube Video on Craigslist Cars and this statement is 100% true. However, you can simulate an imbedded YouTube video and remain in compliance with Craigslist’s rules. Doing so is rather simple and requires a small bit of HTML coding. Adding a video to your ad makes it much more appealing. Most buyers like to get an idea of what the car looks like before taking a look at it personally. While pictures are a great way of doing this, a video can show even more detail. You can simply use your camera phone to shoot the video and if you really want to get fancy you can do a audio overlay in a video editing software.
Steps to Embed YouTube Video on Craigslist
- Shoot your video. There is nothing worse than a low quality video. Ensure that you have good lighting and use a decent quality video camera. If you have a recent smart phone such as the Iphone then this will do. Take a short video of the interior, exterior, and under the hood. It is also a good idea to get some video of the underside because many car buyers are interested in the condition of the body and frame. Put a little effort into it or viewers will quickly move on to the next vehicle.
- Once you have the video that you like, upload it to YouTube or another similar video sharing website. Uploading is easy and only takes a couple minutes. Simply create and account and click on the upload video icon. Once uploaded, you can add keywords and a title. This can often be helpful because people can find your vehicle through Google search.
- After uploading, go to your video and take a screen shot of the video before it is played. There should be a still shot of the beginning of the video along with the play icon in the middle of the screen. This is the picture that you want. Take a screen shot by pressing the prtscr key on your keyboard. The print screen key is located at the top right of your keyboard near the backspace key. Press it once and you will capture a snapshot of your screen
- Open a picture editing program such as Microsoft Paint. Once opened, press Ctrl + “V” to paste the snapshot into the program. Use the trim feature and cut out just the video player portion of your screen shot. Create a new paint document and paste just this into the document and save it for future use.
- Upload this picture to photobucket or a similar image sharing website. Simply sign up and upload it. Take note of the web location by writing down the address.
- Enter the following HTML coding into your Craigslist ad, preferably at the top:
<a href=”http://www.yourvideo.com” rel=”nofollow”><img src=”http://www.yourimage.com” width=”320″height=”></a><br>
Replace “your video” with the Youtube video location and “your image” with the location of your image. You can play around with the width and height numbers in order to get the desired image size.
Sell Your Car!
Now that you have created an ad, kick back and wait for the phone calls to come in. When your first customer arrives be sure to point out all of the good features that your vehicle has. Avoid mentioning anything negative about the car. Be honest if the seller asks you any questions. The last thing that you want is an upset car buyer.
Follow this guide and you can easily turn $2000 or someone else money into $4000. The big question here is how much are you’re making per hour for your effort? Lets add it all up.
8 hours at the auction, 4 hours performing necessary repairs, 4 hours detailing the vehicle and creating an advertisement. 16 hours total. $2000 profit. $125 PER HOUR. Selling cars on Craigslist is much more profitable than working a minimum wage job.
While in school, I would often sell 2 cars a month and earn roughly $4000. Making money doesn’t get much easier than this!