Television programming and infomercials of all styles will have you believe that flipping houses are a fun and fascinating way to turn a serious profit in real estate. It is also so much more. There is a lot of money that can be made by flipping houses. However, there is a massive amount of work that is actually involved in the process of making that money.
The Flipside of Flipping Houses
The sheer volume of work, the time consumption, the sleepless nights and days, and the sometimes disgusting tasks that must be done in order to get a rundown property. In sellable conditions are often glossed over on these television shows for various reasons-most of all the reason that the average Joe sitting at home wants to believe that. He too can do this kind of work for quick profits and these images are not conducive to that illusion. In other words, this is a tough racket no matter how easy they attempt to make it seem.
Poor planning is the bane of a property flipper’s existence. In order to have a successful flip. You must carefully create a plan of action and implement that plan as quickly and cost-effectively as possible. You must also realize that there are likely to be rain delays, hiccups, and disasters along the way. Proper planning can eliminate some of the disasters that may occur. But it will not eliminate every conceivable possibility that will come along. More importantly than anything else however, proper planning can limit. These occurrences as well as their severity to the overall time schedule and budget.
Another important thing, which falls under proper planning, is having a proper inspection done. The importance of this step cannot be stressed enough. Knowing the problems and potential problems that exist in a property can help. You create a workable timetable and budget for the property flip. This also notifies you of potential problems. You may encounter along the way. The television shows that deal with this week in and out often leave out this. Oh, so important step and many would be investors find themselves investing in a money pit rather than a home. That has the potential to turn the quick profits they are hoping for.
You should make every effort to ensure that your first flip is a simple cosmetic flip. In fact, this should be the case for your first few flips and then you can move on to more substantial flips that involve more work. The reason is simple-while the profits will be somewhat smaller on these cosmetic flips. It gives you, as the investor.
The opportunity to learn to budget, set timetables, and live within those budgets and timetables. This is where most investors go wrong when taking on projects that are above their means. A house flip is no small effort and there is a lot of money to be lost along the way when this particular real estate investment doesn’t move out. Start small and ignore the dollar signs in your eyes. Then work up to more extensive projects.
Another pitfall that many investors make is not catering to the audience they are hoping to attract in the property being flipped. A bachelor’s pad does not need 3 or 4 bedrooms. At the same time, a family home typically needs at least 3 if not 4 or more bedrooms. Other considerations should be fenced in yards, landscaping, and maintenance requirements. Low maintenance lawns are in high demand these days. Particularly low maintenance lawns that appear to be well landscaped.
Keep in Mind
Keep these things in mind when flipping your real estate and you should see some degree of success-just remember. The rewards when you are doing things you never thought you would be doing during the process.