The concept of house flipping does not just exist on HGTV shows. Flipping houses is a very popular investment strategy that has become popular in recent years, and offers an exciting, unconventional way to become involved in real estate. House flipping, which is a form of real estate investing, involves purchasing homes, making improvements to them, and then reselling them at a higher rate to make a profit. It sounds simple, but actually involves a lot of planning, coordination, and critical thinking.
One reason flipping houses has become popular is because there are quite a few ways to accomplish it without too much money to start with. This involves taking out hard money loans, finding private money lenders, or wholesaling. These options suit some people better than others based on the amount of experience in real estate they have, their budgets, and their investing experience. It’s important to note, too, that you will still need to prepare to spend your personal money on this project, as costs will come up throughout the process.
Once you have determined how you will acquire the funds to flip a house, there are still many decisions to be made. You will have to find the perfect property, make thousands of decisions about renovation, and be successful in putting it back on the market and selling it. It’s a lot of work, like protecting your floor during renovation but it’s possible to achieve amazing results with the right tips and tricks.
One of the most important components of flipping houses is choosing a property that is likely to resell for a large profit. You should find a home in a popular neighborhood that is on the rise, and in cities or towns where real estate sales are high. This means that many people are interested in moving to the area, and would be more likely to come across your home, view it, and make an offer.
It’s also important to make sure you are flipping a home in an area with low crime rates, since potential buyers will almost certainly look for this. You should also research the ratings of the school systems since that is another thing buyers look out for.
While ideally you could choose any location that checks these boxes, make sure you don’t give yourself too far of a commute. You will be spending months working on flipping this home, and you would not want travel to be a burden, financially or otherwise.
The right property also lends itself well to repairs. This means the home should have a stable structure and shouldn’t be too old, as these are fundamental aspects of the home you wouldn’t be able to modify in the time you will be working on it. Additionally, as you view the home, think about specific renovations you would start on. Specificity is key here; think about specific improvements you would make, and estimate the cost of these improvements relative to the cost of the home and what you plan to resell it for.
While some people opt to handle renovations themselves, others hire contractors to do the work. If you hire contractors, make sure you are specific with your requests and budget accordingly for their compensation. You should consult testimonials to ensure that you trust the contractor you hire; if you do not, this mistake can cause you thousands of dollars in work that has to be redone. If you are able to find a good quality contractor, this decision could save you time so that you are able to resell the house faster.
If you are taking charge of the renovations yourself, consider what you will need to be effective. Driving to and from the construction site for months will likely require you to rent a truck to accommodate the equipment and materials you will need to transport. You might also need to hire people to assist you with renovations, as this is a laborious and time-consuming task for just one person. Whether you opt for self-renovating or hiring a contractor, make sure you have thought through the decision carefully, as it can make or break your house flipping endeavor.
Once your renovations are complete and your house is ready to be put on the market once again, you want to make sure you are maximizing its potential. The most essential thing to do is to stage your home for the best pictures possible. You have already invested so much in this home, and listing it for sale is the final stretch of the process.
Staging a home is the best way to put your best foot forward for potential buyers, and you could do so on a budget. Before you take any action, come up with a number for how much you are willing to spend on staging the home. Once you have that number, you will be able to budget for whatever you may need: decorations, furniture, or even a cleaning service.
Once you have added any details to your home, make sure the photos you post show the best of the home and hide the unappealing features. You can draw attention to particular areas of the home through lighting and the positioning of decorations. This may seem tedious, but potential buyers are easily swayed by first impressions.
Flipping homes is not for everyone, but if it might be for you, these tips and tricks will make your first experience run smoother. Flipping homes is a huge task and responsibility to take on, so it’s important to take the process step by step. The home will not be renovated or sold overnight, so it’s important to be patient and stay hopeful.
The timeline for flipping homes averages to about six months, which is a long time to not see the direct rewards of your labor right in front of you. Just remember that all home flippers experience delayed gratification, but once they get their perfect offer, the hard work has paid off.