Flipping houses is among the most popular types of real estate investing for the short term. It is a high-risk high reward type of investment in which the investor or house flipper often the one doing the flipping himself. It is very important to remember though that there are basically lots of decisions to make from the start if you’re into house flipping. However, none of these decisions are very crucial than choosing the house to buy then selling it later for profits.
Remember that the ultimate goal in house flipping is to find the house from different real estate listing sites as well as foreclosed properties listings, do some repairs if necessary, then sell it fast. This means that the success (and failure) of the flipping relies heavily on choosing the house to flip. If this is your first time to flipping house and needs some guidance, check out this article written by Lending Home about how to find houses to flip.
How To Find Houses To Flip
Finding houses to flip involves two parts: selecting a market and finding a specific property. Let’s take these on one at a time.
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Select a home market
When figuring out how to find houses to flip and before you can even start the process of finding a specific property, you have to decide which home market you want to focus on. If you’re just starting out, the answer is often straightforward: your own backyard. Unless you are an experienced flipper looking to expand his/her business, you often don’t need to look further than your own market to find houses to flip that will be simple and profitable for you.
Flipping in your own geographic market presents several advantages. First of all, you know the area. You know which parts of town are becoming more or less popular, and you have a feel for the culture and attractions of the different neighborhoods. This means that you’ll have a better idea of a home’s potential value beyond what’s on paper (listing price, specs, comps, etc.).
Secondly, being physically close to the actual project itself will save you time and money. You’ll be able to visit the property regularly, whether before purchasing or during the rehab project itself. You’ll be able to meet with contractors, and potentially vet a few different contractor teams before accepting a bid. Meeting in person with a general contractor team, much like a job interview, is the best way to pick up on intangibles such as professionality that may be lost over the phone. Having to travel long distances to and from a site to do these tasks can present a huge headache and added stress. See full post here…
Selecting the home market you want to focus on must comes first before even choosing the property to flip. The best advice you could have is to flip in your own geographical market for it provides you with several advantages. For the first time flippers, choose a home type that’s the most liquid and easy to sell.
If you have chosen the housing market, but still need some house flipping tips, then check out this article by Heather Levin in Money Crashers about flipping houses for profit.
Flipping Houses for Profit – Tips for How to Flip a House
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Several years ago, I became friends with a young woman who was just getting started in real estate. She became a real estate agent, learned about renovation, and made a ton of money flipping her first house. Thanks to some luck and some serious persistence on her part, she ended up on an HGTV show about flipping houses, where she appeared in several episodes as part of an Atlanta investor team.
So how do you know if you’re up to the challenge?
What Is House Flipping?
House flipping is when real estate investors buy homes, usually at auction, and then resell them at a profit months down the road. Can you make money doing this? Yes. Can you make a lot of money doing this? Yes. But you can also lose everything you own if you make a bad decision.
Risk vs. Reward
Imagine buying a house for $150,000, investing another $25,000 in renovations, and then…nothing. No one wants to buy it. You now have to pay for your own rent or mortgage, plus the mortgage for your flip property, as well as utilities, home insurance, and property taxes. You might also have to pay for home staging and realtor fees when the house finally sells. All of this cuts into your potential profit.
According to CNBC, house flipping is the most popular it’s been in a decade, yet the average return for flippers is lower than in previous years. Thanks to a hot housing market that’s raising prices, low inventory, and soaring rents (which drive even more people into home buying), it’s getting harder to make huge profits.
House Flipping Requirements
If you’re still reading, it means you’re relatively unfazed by the high risks of house flipping. Here’s what you need to get started.
Great Credit
You can’t get into house flipping with lousy credit, end of story. Unless you have enough cash to pay for a home and all necessary renovations, you’ll need some kind of loan. And lending standards are tighter than they used to be, especially if you want a loan for a high-risk house flip.
Your first step is to check your credit report to find out your score. Federal law allows you a free credit report from each of the three national credit reporting companies every 12 months, so this won’t cost you anything. You can get your free credit report from AnnualCreditReport.com or by calling 1-877-322-8228. Click here to read the rest of this post…
As mentioned earlier in this article, house flipping is a high risk, high reward type of investment. There might be instances where you can’t get a profit in transactions, or worst end up losing big time due to unforeseen additional costs such as renovations, taxes and more. On the flip side, however, there could also be transactions where house flippers hit the jackpot, earning huge amount of profits.
What could be the secrets to all of these? Teresa Mears published an article on US News explaining the secrets of successful house flippers and how they achieved much success in their journey towards real estate investing.
9 Secrets of Successful House Flippers
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We’ve all seen the home improvement shows on TV: A personable couple (or few brothers or even cousins) buys a forlorn house, turns it into something beautiful and sells it for a profit, all within a few months.
Reality check: It’s not as easy as it looks. People make money flipping houses every day, but the secrets to success start with really knowing what you’re doing. And finding a good house to flip is much harder now because the market is so strong for bargain-priced homes.
“It is difficult to find a house to flip that makes economic sense,” says Mindy Jensen, community manager at BiggerPockets.com, an information hub and networking platform for real estate investors. “You’re competing with retail buyers. They’re buying the unwanted houses because there’s nothing else.”
Brian Peavey’s company, ProfitShare, uses direct mail, door hangers, social media, real estate agents and personal connections to find homes to flip in Boise, Idaho. To make its offer more attractive to sellers, ProfitShare promises an additional payment once the flip has sold.
When his company’s offer is rejected in favor of a higher offer, Peavey puts in a backup offer in case the first deal falls through. “We’ve had multiple houses that we’ve ended up on second position on,” he says, eventually closing the deal. See the rest of the post here…
What is no secret is that house flipping is a profitable real estate investment type, but comes with a huge risk? So, if your risk tolerance isn’t that aggressive and doesn’t have that much of capital to start with, then house flipping is not your cup of tea. There are lots of ways to become successful in the market the same way these people who made fortunes in flipping. It takes time, lots of research and courage to start investing.
If you plan to do house flipping but don’t know how to sell house fast, we at Dependable Homebuyers can help you achieve the goal of selling your house fast, no hassle and at the right price. There are lots of benefits of letting the pros do it than selling it on your own with little knowledge. Remember that time is also a crucial factor in this type of investment. To get started, visit us at https://www.dependablehomebuyers.com.
