INVESTORS GUIDE / HOUSE FLIPPING
House flipping is not a get –rich quick scheme. It can be a risky practice if you go into it blindly. It is just like any other investment and you shouldn’t decide to do it on a whim or if you are financially unprepared to take a loss. Keep in mind that for every success story on TV showing investors making millions on house flipping, there are at least 10 who lose everything they have with their investment. Working with a professional in the field who knows the ins and outs of house flipping is the best place to start if you want to be on the road to a successful home flip.
DONT’T MAKE THESE MISTAKES
One of those most common mistakes people make is thinking that the more money you put into the property, the more you’ll get out of it. This is simply not the case. You have to know your market, and a real estate agent will be the one to help you understand how much you can expect to get out of the final sale. Each market is different and knowing the facts will help you make more educated decisions as well as be able to plan better for the return on your investment.
Another mistake people make is making the property into one they would live in personally. In some cases you may decide to live in the property for several years and then resell it. If this is your plan, you will still want to carefully consider the upgrades. You may really want a steam shower in the master bathroom but it may push you over budget. It is important to realize you may not make that money back in 2-3 years when you decide to sell. The homes that you plan to flip right away should be upgraded with the basics for that particular market. Don’t use your favorite colors but rather do some research and find the popular colors that builders are using. For example, wallpaper made a comeback several years ago, but it is expensive and time consuming to use in a house flip. Even though it is popular and you may really like a certain pattern, stick to the neutrals. Don’t overthink the upgrades – keep things simple.
Home flipping is a risk that can come with large rewards. The feeling of accomplishment that comes with flipping a house and having it sell quickly can turn into a driving force that navigates you to flipping multiple properties. As long as you are smart about your home flips, you will find that it can be a business worth dabbling in.
Work with a professional real estate company to fully understand the markets and to even help you find a good deal on a property. While you may think it will cost you more, their advice and ability to negotiate can actually save you money and time in the long run. They can alert you about price fluctuations, even if that is a hot market for house flipping.
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