House flipping is when a real estate investor buys houses, fixes it up and then sells them for a profit. It seems like a very appealing investment opportunity, especially for first timers that want to make a significant profit. And although it sounds easy, if done incorrectly, you may be stuck with an incomplete project that nobody wants to buy. An investors nightmare!
Here is your beginners guide that will help to shorten your learning curve and get you flipping houses profitably in a short period of time.
1.Finding a house to flip
The first step in the house flipping process is the most crucial to your success. You want to look for an ideal property with profit potential. Finding a suitable property to flip is certainly a challenge. Ideally, you should be able to buy a house for a low price, eyeball it to be able to fix it quickly and relatively cheaply, so you can sell it at a higher price and make a profit.
A good real estate agent can assist you in finding houses to flip. You may want to focus on properties that theoretically won’t need expensive repairs. Alternatively, you can focus on properties that DO need extensive repairs, which in turn, when fixed will substantially increase the equity and value of your property.
2.Assess your financial cash situation
The next step to flipping houses is deciding how much you can afford to spend. This depends on your personal savings as well as your available financing options. A key step to profiting from a flip is not paying too much for a house. When deciding how much to pay, estimate the amount you can reasonably sell the house for after it has been fixed up. From there, deduct your expected costs which may include the following:
-Purchase price
-Cost of repairs and renovations
-Taxes
-Holding costs
Many people also buy with cash only as it is the simplest and most popular form of house flipping. It cuts out the cost of mortgage applications and approval processes. Additionally, it makes your offer more appealing to sellers. Plus, you won’t have to make ongoing interest payments for the property as the renovations are underway.
When making a budget, many people suffer losses because they fail to take into account the housing market, therefore it is vital to give room in your budget for any unexpected events.
3.Start building your house flipping team
The next step is to build your house flipping team. No matter your level of experience, you simply will not be able to do everything on your own. Therefore, creating a team will help you be more productive as well as help you work through the inevitable challenges that you’ll face. Your team should be comprised of contractors, architects, accountants and insurance specialists. All these professionals will ensure a smooth and profitable house flipping process. Keep in mind, if your renovating a house that you hope to sell for a significant profit, scale back on the high end finishes and custom installation. Instead, focus on refinishing the existing interior, new landscaping and a fresh coat of paint. A quick tip to give your house a newer look is by swapping out old appliances with new, inexpensive ones. These small details can make a huge impact!
4.Get guidance from an expert real estate company
Having an expert real estate company on your team is crucial to profitable house flipping. First, you’ll need their help finding a perfect and affordable house to flip. Once you’ve successfully renovated your house and its finally ready to sell, you will need someone to value your property and estimate the best deal you can get.
Here at Dunhill Consulting Ltd, we provide you with sales and lettings services as well as property valuations.
Choose us for your house flipping needs for a professional, cost-effective and hassle free experience.
For further information call 0789 386 445 / 0786 386 445 / 0720 911 136 Email: sales@dunhillconsulting.com Or visit our website: www.dunhillconsulting.com