Real Estate and Flipping Houses
What’s involved with flipping houses?
There are a few key points that need to be known if you’re planning on flipping houses. The first is financing and money management. The whole idea behind house flipping is that at the end of the project, a profit will be made. If you’re spending more money on renovation, land and labor, then you are never going to see that profit. The age old rule of buy low and sell high applies here. The majority of people who flip houses buy their houses from foreclosures which helps to ensure that a lot of money is saved when buying the actual property. These houses are generally in pretty good condition and most will only need a few touch ups here and there before they’re ready to be put back on the marker
The second major factor when it comes to flipping houses is the restoration or renovation of the house itself. A lot of the times, this is the most costly part as the houses are generally bought fairly cheaply from foreclosure sites or from desperate sellers.A clear budget needs to be laid out to ensure that the minimum amount of money is spent on renovating and restoring the house. Materials and labor will be the biggest money sinks when flipping houses. To save the most amount of money possible, some people even decide to renovate the houses themselves, thereby eliminating all costs needed to hire a work force to do the work for you.
One of the best benefits of doing all the work yourself, besides saving a load of money, is that the risk of hiring a shoddy contractor is completely eliminated. If you do decide to hire a contractor, no matter what their profession, you should always ask for a list of references and if possible, a portfolio of their previous work to make sure that they aren’t going to leave you with any nasty surprises when you are flipping houses.
A few things to look out for when flipping houses
When you’re flipping houses, there are a few things that you should always be wary of. They include, but aren’t limited to:
- Over pricing your work. You may think that all the work that you’ve put into the house is worth a couple of extra zeros on the end of the price tag, but by over pricing and over evaluating the work that you’ve put into renovating or restoring a house, you run the risk of not selling it at all
- When flipping houses, it is important that you don’t skimp out on the important things in order to save a couple of dollars. While the cheaper materials may seem attractive while you’re restoring a house to flip, the chances of them causing you troubles down the line is increased.
- And finally, while you’re flipping houses, make sure that have a clear time table set out before you start a major project. A time table as well as a brain map are great resources that can save loads of time and money simply be keeping you and your workers organized while flipping houses.