Five Tips For Flipping Houses Successfully
Flipping houses is not an easy or quick way to make money. However, if you’ve got what it takes – you love construction; you have an eye for home design; you have the capital to invest; you know something about real estate; you have a high tolerance for risk; and you have the patience for the Job – you can definitely be very successful, even in today’s low-inventory market.
Flipping is an exciting and really personal way to invest. However, you can’t go in blind; you’ll need a bit of guidance. Here are my five tips for a successful flip.
Reality TV may lead you to believe that anyone off the street can stumble on the right property and make a profit. However, there are a thousand things to learn about flipping homes before you begin if you want to have the best chance at success. You should research your area’s current housing market, find out about potential costs of labor and materials, brush up on your construction and design knowledge, and uncover any permits you might need and legal obligations you might have. When you do find a house you want to move on, you should learn as much about the home as you can.
Set a reasonable budget and timeline
Once you’ve found and purchased the right property, have a contractor walk through the house with you and tell you what all of your proposed changes will cost, and how long it will take him to get the job done. Feel free to get a second and even third opinion. Always include a hefty cushion in both your budget and your timeline for unexpected problems. Inspectors can’t see through walls, and you never know what added time and expense you might be confronted with when the walls come down.
Hire the right help
Nothing can sink your project faster than hiring the wrong people to help you – people who don’t show up, do shoddy work, or cheat you. Thoroughly vet your contractor. Ask for credentials and licenses, and ask around to find out about his reputation. Don’t automatically go with the most affordable offer for the job – remember that you get what you pay for.
Don’t get too attached
This isn’t going to be your home. You may really love it, but getting personally attached and emotionally invested is a bad idea. It won’t just break your heart to sell it – you may end up making decisions that can cost you, such as buying materials that are to your taste or doing a remodel that suits your needs or preferences, rather than making choices that are financially sound and offer the broadest appeal for buyers.
Don’t be too unattached
Don’t get so focused on the fact that you won’t be living in this property that you forget that someone else will be, and they’ll have to live with your decisions. While you certainly don’t have to go high-end (unless the area calls for it) you should always opt for quality materials that will last. Buyers will be able to spot a cheap fix from a mile away.