Are you familiar with the term ‘house flipping’? You may have watched HGTV ‘House Flippers’ or the latest show ‘Flip or Flop’ and found it exciting to view how fast they can buy, redesign the interior and sell.
House flipping is a term real estate buyers or investors use when purchasing a home only to sell it for a profit within a short time span. House flipping is a high risk real estate investment as it may require attention and intense research. There is also a chance you may end up losing your money if it is not planned out. Understanding market trends and the real estate market can make or break your flip, here are 6 steps to know when it comes to house flipping:
1. Check for the Condition of the house
Search for a home that has good sound structure and this can be done through inspection by a qualified professional and these ranges from the sewerage systems, electricity and other important parts of a home.
2. Decide Your Location
This is one of the most important factors simply because it is always the location that dictates the price of a home, more so, all you have to check is the social amenities and auxiliary services available within the locality such as schools, libraries, banks and stores.
3. Know the cost of remodeling
This is one factor that will always dictate the profit that you will get in the long run, in that case you have to ensure that the cost/value of the house is lower than the value in the local market simply because you still need to do some renovation and fixing a number of areas of the house before putting it in market.
4. Determine the Return on Investment you want
You should always set a goal on you target amount that the house will give you, actually it should be around 15% to 20% of your total investment, now this requires sound knowledge of the market or you may choose to use an experienced personnel in the field.
5. Benchmark from successful house flippers
The real secret of success is by learning from others. Seek out a mentor or ask questions to seasons flippers, this will help you avoid the mistakes that others have made in the past.
6. Talk to your Realtor!
No one knows how to maximize your profit better than your realtor. It’s important you go to them for the best tips and advice on how to make the best deal for you.
It is only through dedication and wise decision making that you will be able to get the best returns within a record time.
If you are interested in flipping a home call or text us at (949) 842-5340 or E-mail info@TheLynchGroupOC.com. We look forward to hearing from you.
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