TOP 5 TIPS FOR FLIPPING HOUSES

TOP 5 TIPS FOR FLIPPING HOUSES

Flipping houses for profit has become one of the most popular ways to make money in the property market.  Whether you are completely renovating a house or doing some minor improvements the choices you make along the way could end in a large profit or a large loss. The key is to make the right choices along the way to ensure you achieve the profit you envisioned when purchasing your property.

1.       PURCHASE PR ICE IS WHERE YOUR PROFIT BEGINS

When considering purchasing a property you need to factor in the costs of all the repairs and renovations. Many times investor’s think they are getting such a great deal on a house but after they have finished paying for all the improvements and it’s time to sell their house there isn’t much profit left to be made.  Instead of jumping at what looks to be a great deal, you should first calculate what the total cost of improvements will be and add that onto the price of the house. At this point you will be able to see if you will be able to achieve the large profit you are looking for and possibly use the repair costs as a way to lower the purchase price of the property.

2.       HOMEOWNER’S INSPECTION CAN SAVE YOU THOUSANDS

Spending a few hundred dollars on an inspection can potentially save your investment.  As an investor you want to stay away from overly expensive repairs that visually won’t improve the home to potential buyers.  Roof replacement, foundation problems, plumbing replacement are just a few of these larger items that you may not be able to see but a homeowner’s inspection could.  If you avoided getting a homeowner’s inspection and a potential buyer does and finds all of the items wrong, the cost to repair will come out of your profit. This could ultimately result in little or no profit.  This could also be the cause of what seems like a bargain price. If it sounds too good to be true, it usually is. 

3.       DON’T SACRIFICE QUALITY

Although it may be very tempting to go the cheap route on renovating the house, it will show.  If you start to forgo the quality of work going into the house just so you can get the cheapest price it will be evident to buyers walking through your house.   Buyers will notice the poor craftsmanship that went into the house and this can result in buyers asking for a lower price to have the work redone or buyers will simply walk away and your house could end up on the market for months.  You can always look for bargains on the materials needed for the repairs but you should always use a licensed professional to do the work on the house.  The end result because of this will be evident to you and to the buyers and will get you a quicker sale and better price than if you had gone the cheap route.

4.       HIRE EXPERIENCED CONTRACTORS

When hiring contractors make sure you are hiring experienced people who will show up every day and get the job done.  You shouldn’t be paying everything up front and you need to make sure all the permits needed are properly secured. You want to avoid ending up with a contractor who takes too long to finish a job, every day work is being done is money out of your pocket.  You often hear of contractors who show up and get the job started with a bang tearing out carpet and walls but then disappear for months at a time making up excuses along the way and leaving you with a mess.  To make sure this does not happen and you don’t lose money because of this make sure you hire a reliable, experienced contractor with a good reputation.

5.       REALTORS

Before you even purchase the house you are going to flip you should be using a realtor until you sign the papers on the sale of the house.  An experienced realtor will understand the buying and selling market which is pivotal for what you are doing.  They will know the best areas and neighborhoods to look at not only for the best purchase price but also for the best selling price.  Having a realtor by your side means you will know about properties before they are even placed on the market which can give you the head start you need above your competition.  A realtor will get your house in the MLS system which ensures it will be seen by everyone and they will be actively marketing and advertising your property to get you the sale and profit you are looking for. 

This entry was posted on May 12. 2010 at 12:41 and is filed under Blogroll. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response or trackback from your own site.

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