You can certainly make money flipping real estate the first way described. More experienced investors can make money even when the situation may not work out quite as planned. This is yet another benefit to flipping real estate. If it doesn't work out exactly as planned, there is always the option to lease option the property or rent the property out. The fact that there are options and that you are not stuck with a bad flip is definitely a benefit.
There are other angles such as flipping a home in foreclosure, which would consist of purchasing an undervalued property in need of work, repairing it, and putting it back on the real estate market at a higher purchase price. A flip of this type can yield large profits but it will depend on different factors whether this is the best approach for your situation. With extensive renovations this will often require more initial cash or financing to get the deal done. This is why these type of flips are most easily executed with homes that require minimal repairs and primarily just need cosmetic work completed.
Flipping homes can also have a positive effect on a neighborhood by the development and re-growth of a stagnant area. Renovated homes also draw new people to an area and encourage economic growth. While flipping presents exponentially large profit potentials, it also poses large risks if you actually take ownership of the property to rehab, so you want to take the right steps to protect yourself.
The more risk free option is flipping via contracts. This is also sometimes referred to as wholesaling or assigning properties. This is where you tie up a property at a discount (using an agreement) and then flip the contract it to another buyer or investor for a quick profit.
The benefits include it's virtually risk free, there is no need for excessive cash or credit or financing, you are not taking ownership so there are no closing or holding costs and you do no repairs or work yourself. This is why when it comes to making quick cash in real estate, this real estate investing method is one of the best routes to take especially for real estate investing today.