The primary goal of Flipping Houses is investing in the home and eventually selling it for a profit. One of the first misconceptions individuals believe is that all house flippers perform renovations to increase the value of the property. While this is the case more often than not, some investors purchase a property in duress and list the property without putting any money into it. The key to being successful at Flipping Houses is finding a property that will earn you a decent profit in the shortest amount of time. Houses in duress usually offer the best opportunity. Look for properties with tax liens, properties that are part of an estate sale, properties in foreclosure, or houses showing signs of age.
Financing and Insuring Your Investment
One area no reality show has ever focused on is how house flippers finance and insure their investment. Obviously, with such a large investment, you are going to have to take out some kind of mortgage or type of equity in your home. It is important to consider the risk when you are taking on a flip. Financing your flip in the wrong way can set you up for failure. If the loan you take out on the property has a prepayment penalty or seasoning issues, you could eat into your profits. Timing your flip just right is essential. In a perfect world, you will never actually own the property. Experienced flippers arrange a sales contract with the seller and resell the property before the contract closes.
Become an Expert in the Area
When you start Flipping Houses, you will need help from an expert contractor familiar with the area. It is important to learn what characteristics are most desirable in the area. In some areas, residents consider land a must. In other areas, pools are significantly important. You should also look into what houses in the community have sold and if the community you are investing in has plans for future developments. All of these factors will play into profitability and success.
Flipping Houses is much more than just buying a home, buying a paint brush, applying a fresh coat of paint, and reselling the home for thousands in profit. Just like the movies, cable television has played into the idea that flipping is an easy way to get rich. You will need to build a team of professionals and truly turn flipping into a business if you want to succeed.
People are always talking about money and investing opportunities. Today, people are interested in investing in real estate and getting profits from flipping houses. It is the strategy of buying and selling a house in just a short period of time to make a profit.
In another word, you resell your recently purchased properties with a little bit of renovation and maintenance to make it more attractive to customers. However, if you are not careful in selecting and updating your house you may lose a money trying to get rid of the property that no one desires to buy.
When the prices of houses seem to keep increasing, it creates an attractive opportunity for people to invest in property flipping. A 10% to 15% increase in property prices within months after the sales, the new owner can make a good chunk of profit reselling it to the highest bidder.
For example, if a person purchased a single family home for $250,000 in a seller market, within two months that property price increased 10%, plus extra profits on any updates the new owner recently did for the house, s/he can resell the property to gain a $25,000+ profit.
An intelligent and experienced professional can utilize as well as leverage his/her resources to the maximum so that s/he can generate a good chunk of profit without dealing with cash, or even come up with his own money. Everything is transferred electronically with most of the fund comes from third parties like banks and other financial lenders. That’s why it is called Cash Free Investing.