Property flipping or flipper houses can be excellent investment opportunities—as long as you know what you’re doing and avoid common pitfalls. When done right, both property flippers and the home buyers benefit. When done wrong, it can cost you.
Today, we’re going over five insider tips and strategies you can use to learn how to flip properties the right way.
1. Research the Market
You’ve heard it before, and it still applies: location, location, location.
When searching for investment properties, research the market. Know the area, or take the time to learn about it. Know which cities are the best to flip homes and which ones to avoid.
Work with a real estate agent to learn the latest insider news about the market, trends, and more that will help you out.
2. Finding Deals
Many flippers look for foreclosures since you can purchase the home for less than market value. The downside is that a lot of these properties are in bad shape and can wind up costing you more than you bargained for.
Where you buy the home and who you buy from also matter. In seller-to-buyer purchases, the seller has to disclose all known problems. However, banks do not need to disclose this information to you.
3. Analyze the Costs
Calculate the value of the house now and what it will be after repairs. Remember to add up all the estimated repair costs, hidden fees, and taxes.
If you can fix something yourself, that’s great, but you may need to hire contractors for certain work you’re not qualified to handle. Property flipping isn’t the best time to use YouTube to figure out a DIY solution.
Once you have all the numbers, you can determine if a property is a good investment or not.
4. Invest in Legal Help
When researching how to find, fix, and flip properties, there’s likely going to be issues you don’t fully understand or government regulations you need to follow.
Investing in legal services can help keep you out of hot water. For instance, a mortgage fraud lawyer can protect you if you’re charged with mortgage fraud or prevent you from making mistakes that lead to a mortgage fraud investigation.
5. It Takes Time
Flipping houses isn’t for impatient people or those that can’t sink a significant amount of time into a property. It can take weeks or months to find the right property, and then you need to invest the time and effort into fixing it up. From demolition and construction to ordering cabinets and appliances, you should also expect delays.
Expect to put in a lot of weekends and evenings. Even if you hire contractors and workers, you’ll need to account for the time spent supervising. Selling the property can also take time, depending on the market.
Learn More About Property Flipping
The more skills and knowledge you have, the easier it’ll be to get into property flipping and make a profit. Use these tips to get started, and spend time researching the market and securing funding before you dive in.
To learn more about property flipping, the latest real estate news, and more, check out some of the other sections on our website.
