To flip or not to flip—that is the question many retirement planners are asking themselves. Since we can no longer count on Social Security or the stock market, and the real estate market continues to be hot, buying, fixing up, and reselling or "flipping" houses, is a popular investment strategy, so much so that it's the subject of two new reality TV shows: "Flip This House" (A&E) and "Flip That House" (Discovery Home).

Joe Belluso of Greenman Properties, a real estate and construction firm in Stone Ridge (www.greenmanproperties.com; 845-687-5266), believes in flipping as a reliable way to make money. "The real estate market will never truly bubble like the stock market," he says, and unlike the stock market, "the real estate market is never influenced by people who flip houses. If you get in and out quick enough, slight market changes won't hurt you, although of course world events can affect real estate like everything else."

Belluso and his business partner and wife, Megan Park, tend to rent out most of the properties they renovate. However, says Belluso, they also take a decidedly cautious and thorough approach to renovation and resale, which is what separates "true flippers" from mere speculators.

"I've seen so many people who are trying to flip houses go in and lay down bad carpet and vinyl floors, and think that painting a room will hide everything, but the buyers see right through it," says Belluso. "The point is to make it a fast turnover to make money, but a true flipper gets in and renovates."

Trouble occurs when people are so focused on profiteering that they don't take fully into account what it will cost to fix a house before they flip it. "Generally, you need more money than you think," says Belluso. "You need a fat pocketbook, no matter who's doing the construction, whether you're doing it yourself or you're outsourcing to a construction crew."

Unforeseen structural problems can occur on the job, requiring extra expenditures to fix, and renovations often take longer than expected. "You might not know that it's going to take $3,000 to pull off the old plaster lathe and replace it with drywall, or that you'll have to replace a wooden roof that failed—like I did once—at $50 a sheet," says Belluso. "Plus, every month that you're in a place, fixing it up, you're paying insurance, taxes, utilities, maybe a mortgage and financial charges. Before you buy, you should immediately tack on a couple of months' extra costs, just in case, because for most people, all your money is tied up in the project until you sell it. The trick is to keep things in check, and get in and get out quickly."

The secret to successful flipping, says Belluso, is to work backward from your desired selling price. "Your effort when doing a fix-up is worth the money people want to pay on the back end. That's why I always play a game and figure out how much money I want to make selling a house before I buy it."

First, Belluso decides "what we want to get when we sell it and what it'll take to get there." It's helpful to get a realtor's opinion before buying, he advises, because "they can tell you things like: If you fix up a raised ranch in Stone Ridge, you won't get $275,000 for it no matter what you do to it."

Next, he figures out the cost of the project. "It's good to consult a contractor and a building inspector. A building inspector will say the heater's old, but the contractor will tell you what it costs to replace it." Once you've figured out the time and materials needed, subtract that from the list price. "Then I do a spreadsheet and play with the variables; figure out the best and worst case scenarios. I do a lot of 'what if,'" says Belluso.

"Should I finance part, should I finance none? I try to make at least 20 percent total annualized profit. But if I make 10 percent over six months, the return on my investment is the same as if I made 20 percent over a year. That's my worst-case scenario. My best case? Who knows? You can really make some money if you're fortunate enough to find a foreclosure before it went to auction or know someone on the inside selling, or have an estate situation."

For Belluso, the goal is always "to make more than if I played the stock market." While he admits flipping houses can be "a fairly risky proposition," he believes that "as long as you're not being a speculator, you can buy and fix up and not lose your shirt over it. But, boy, be ready for those unforeseens."