What is Flipping Houses
The definition of home flipping is buying a property that needs repair, often a foreclosure or distressed property, making repairs and then selling it before the first mortgage payment is due. The purpose of doing this is to make a large profit in a short amount of time. How realistic is that? Keep reading for our tips on flipping houses.
Is flipping Houses Profitable?
Can you make money flipping houses? Yes! Flipping houses can be very profitable if you find cheap real estate and then can sell it for a profit. Buying and flipping houses sounds easy, but make sure you have a secure financial backing in order to get started flipping houses. We recommend creating a business plan for flipping houses – before you start home flipping. Making profit on real estate is possible, even if it isn’t as easy as it might look on TV.
How to Start Flipping Houses
So, you think flipping houses might be right for you? Here is how to get started flipping houses:
- First, consider your finances. Are you able to pay cash or will you need a mortgage? There are tax laws and prepayment penalties on some mortgages, so make sure you investigate these issues before you get started.
- Second, create your flipping houses business plan. What do you want to accomplish and what is your timeline?
- Third, research the market in your area.
- Fourth, research discounted properties – short sales, foreclosures and distressed properties are great options.
- Fifth, when you do find the right property, move fast!
Finding Cheap Houses to Flip
Buying and flipping houses starts with finding bargain homes – foreclosures, distressed properties and short sales are the most likely types of properties. Finding these homes can start with an online search or by reaching out to a real estate agent. There are a lot of homes on the market that may work for a flip – often they may be run down, unsightly or in need of repair. Check out our guide “How to Find the Best Houses to Flip” for more details.
Flipping Houses Tips
Prepare yourself for a lot of hard work and time spent researching and then rehabbing your property before you start buying and flipping houses – unlike TV, this isn’t a process that only takes 30 minutes.
Do research to learn even more about how to get into flipping houses – the process isn’t difficult but there are rules and regulations that govern mortgages and taxes that related to home flipping.
Search for the right property to rehab and ensure that you’re earnings will be enough to make doing the flip worth your while.
Keep some money in savings – often the costs of repairs and renewal of a property is more expensive than you might think, make sure you keep funds in reserve for unforeseen circumstances.
Make wise selections when you do upgrades and repairs. Kitchens and bathrooms are often said to sell homes – ensure that your flip has upgrades in these areas.