Top 3 Reasons Real Estate Is Fast Becoming Hollywood’s Favorite Side Hustle

Ellen DeGeneres has had a few tough years that have culminated in her finalizing her decision to finally retire from the Ellen show. However, these struggles have not slowed Ellen down in other areas of her life, least of all her real estate investments.

Ellen and her wife, Portia De Rossi, are two of Hollywood’s most notorious real estate owners and investors. While many other celebrities hold on to their mansions, Ellen has become somewhat of a real estate tycoon with her constant flipping of houses. This real estate strategy is now fast becoming Hollywood’s favorite investment.

In one of their most profitable ventures, Ellen and Portia purchased the Brody House for $40 million and, after some significant restructuring, were able to sell it for a whopping $15 million profit in a transaction that Annetta Powell, the author of Finding, Fixing & Flipping Properties and CEO of Infinity Properties Group, describes as a textbook case of amazing flipping.

In Powell’s words, “The average real estate flipper can make upwards of $50,000 per house, but A-list celebrities have access to enough funds to play the game at the higher levels, making a $15 million profit on a $40 million property still aligns with the percentage earnings expected in the industry, its a textbook case of amazing flipping.”

Jennifer Aniston is another celebrity that has since made a name for herself in the real estate industry. Not only is she Hollywood royalty, but her shrewd displays in the real estate market have also made her real estate royalty as well. Aniston has been playing big in the California real estate market for some years now and seems obsessed with the creative challenge that every new project presents.

Aniston’s approach to buying and selling her Beverly Hills mansion got rave reviews. After purchasing the property for $13.5 million, she invested some time and money in renovations, then featured it in the Architectural Digest, which instantly upped its value. She later sold the property for $35 million, allowing her to double her investment. More recently, Aniston sold her Bel Air Mansion that she had purchased jointly with her ex-husband Justin Theroux for a stunning $75 million, effectively tripling their initial $21 million investment in the property.

Why Real Estate?

It’s not new news that celebrities love buying and owning massive homes, but in recent times, we see more celebrities tilting more towards house flipping rather than ownership, and this trend is not just enjoyable. It makes a great deal of sense as well.

“Real Estate investments are very stable,” Powell explains, “The only restriction that people have in entering into real estate is access to funds, and this is not something that A-list celebrities struggle with, so it makes sense that they would be attracted to these kinds of investments.”

Powell has been flipping houses since her early 20s. She has garnered over $50 million in profit from her flips and has become a prominent advisor and investor in the industry.

Powell insists that Hollywood’s sudden obsession with house-flipping only mirrors what has been happening among average real estate investors and entrepreneurs in America for decades; “The best thing you could ever invest your money in and sleep well at night is real estate, and I don’t see that changing any time soon. The beautiful thing is that real estate increases its value over time, just like a fine wine, so the longer you own a property, the more the neighborhood evolves and improves, the more money you can make.”

Fame doesn’t last forever.

Most celebrities are acutely aware that they only have 5-minutes of fame. For celebrities, what they do during their active earning years could extend their fame a little longer.

For instance, Shaquille O’Neal’s shrewd investments during his playing days have turned him into one of the country’s most notable entrepreneurs and investors. Like many other celebrities, Shaq also boasts an impressive real estate portfolio and a thriving real estate investment business; O’Neal Group.

Music artists seem to be the ones affected the most by fading fame, and a few of them have also made real estate investments a haven for themselves.

Vanilla Ice – aka Rob Van Winkle – is probably one of the most notable music celebrities who has made a fortune from real estate. Ice’s music topped Billboards in the 1990s. Ice also used his heydays to purchase single-family units and condominiums. Long after the music fame has faded, Ice has made a fortune flipping houses and even hosts a house-flipping show on the DIY network.

Short turn-around-time and huge ROI

“Celebrities are entrepreneurs at the end of the day,” Powell explains, “and as entrepreneurs, we are always looking for the most profitable investments that can earn us the most profit in the shortest possible time. That’s what real estate investments and especially house-flipping achieves.”

If there is anything that celebrities have an abundance of, it is funds, connections, and a large following, making real estate investments extremely attractive and practical. According to Powell, the average time to flip a house differs based on available funds and the size of the property. However, she estimates that an investor should be able to successfully flip a house between 6 months to 1 year at the most. This kind of opportunity has turned into a massively appealing investment to both celebrities and real estate entrepreneurs alike.

Celebrities always seek to expand their portfolios and diversify their proficiencies; no one wants to be known for only one thing. As it turns out, this desire is not just wise. It is profitable too.