If you’re starting your house flipping journey, you already know what it is, but for the sake of anyone who just happened across this article, let’s dig a little deeper into the matter. House flipping is when you buy a house at a low price, improve it, and resell it for more money. House flipping has been around for about 40 years and is currently experiencing a 20-year financial peak, so now is a great time for you to be getting involved. On average, a flipped house is currently making a profit of about $70,000 when it sells. The catch is that getting that $70,000 is going to take some hard work. No, I’m not just talking about the actual renovation, though that can definitely be a workout. The hard work begins in the planning stage and continues until you’re done with the flip.
If you want to make the process a little easier, there are some tips and tricks you need to know when you’re new to house flipping.
Look For “Ugly” Houses
Looking for ugly houses is one of the brilliant house flipping tips experts recommend. Why? Because they’re cheaper, and the issues will mostly be cosmetic. If no one wants to buy the house as-is because it’s ugly, you can snatch it up and make it beautiful. Of all the things that could be wrong with a house, cosmetic issues are the easiest to fix. That means it won’t take as much remodeling to leave with a profit, and you won’t have to bring in experts.
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Choose Neighborhoods That Are Growing In Popularity
If a neighborhood is already popular, it’ll be harder to find an affordable flip. Stick to areas that are beginning to take off. Some signs of this include other houses that have been flipped, new builds beginning to go up, and popular chains moving in nearby. Houses in these towns will still be relatively cheap compared to more developed areas, so you’ll be able to get a good deal. You can also cash in on the traffic coming to see the new builds when you sell. When buyers notice a completely redone flip that’s cheaper than a new build, they’ll be interested. The goal is to buy low and sell high, and sometimes that means estimating which area is the next big place.
Keep Your Upgrades Simple
Contrary to popular belief, you don’t have to do every fancy upgrade in the book to sell a flip. Most of the time, a few simple upgrades will do. The goal is to stick to the 70% rule. This means that If you’re aiming to sell the house for $150,000, and you paid $80,000 for it, your repairs need to come in at $25,000 or less to ensure you make at least a 70% profit on the house. Keeping that budget in mind, start with new appliances. Modern appliances in the kitchen, bathroom, and laundry room can do wonders. It makes a home feel newer and lets potential buyers know they won’t be stuck modernizing the house themselves. After appliances, handle your cosmetic issues. New flooring, a fresh coat of paint, shiny new fixtures, and some modern lighting will make a house look completely different. You don’t have to make lots of expensive changes to make a house look expensive. You just need to take the time to come up with the right design plan.
Put The Tips And Tricks To Use
Now that you’re ready to put the tips and tricks to use, you need to request a house flipping loan. This loan is also referred to as a fix and flip loan. If approved, you’ll receive the money to buy and upgrade your flip. When you sell the flip, you can use some of your profit to pay off the loan. You have 9 to 24 months to do so, depending on your terms, so there’s no rush if it sits on the market for a few months before the right buyer comes along. Apply for a loan today so you can close on a flip and start getting in touch with your inner designer.
These tips and tricks can help you go from new house flipper to pro house flipper in no time.
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