House flipping is not all about investing your money and earning profit. There’s lot more to do! Here is an easy guide from popular real estate expert, DC Fawcett on how to earn big returns from house flipping.
House flipping is a great way of real estate investment! No doubt! But the way of doing it is where many new investors makes mistakes and their house flipping becomes a big flop. Compared to other types of investments you can earn money in house flipping quickly. It can provide you higher profits within short span of time if you do it right.
Along with an investment, flipping house or real estate properties gives you exposure to wide variety of areas like real estate market, estimation costs etc. The basic definition of house flipping would be buying a house for under market value, repairing or renovating it and selling it for higher price. While doing the repairs or remodeling you will come to know the cost of things needed. You can also know the procedure of electrical and plumbing repair works.
Dc Fawcett – How to buy houses for flipping?
If you are into house flipping for first time, then go for structurally good houses. Buying the old and severely damaged houses will bring unwanted hassles and you might have to fix it from scratch. On financial perspective, you may have to spend more money on such houses. Even after the accurate calculation of renovation cost you may have to spend on expensive renovation work which leads to heave loss.
Is it essential to do market research before purchasing house for flipping?
Even before searching for structurally good houses to flip you have to do a thorough research on the local market where you are buying the houses. Refer to multiple listing websites and search for your desired locality. You can also contact reliable real estate agents and follow their in buying the house for flipping.
Understanding the buyers need is also an important thing to do. Once you have bought the property for flipping after a thorough research on local market then analyze what buyers need in that area. Some of them wish to make little adjustments in the property which can be made for their convenience.
What are the risks involved in house flipping business – Dc Fawcett Tips
There are many risks involved in house flipping investments and it needs some hard work to tackle all these issue. The major issues with house flipping are unexpected expensive renovation costs, permit for building, unexpected delay in the construction, material faults, problematic workers or contractors, and holding costs. Due to these reason you might not be able to sell the property within the timeline. Delaying in the process may create a heavy loss to the house flippers. As old as the house becomes the buyers may easily lose interest in the property and move on.
The best time to sell the house is, the first few weeks after putting up it on sale in the market. Hence it is better to avoid delay in the house sale process and sell the house as soon as possible.
Possible reasons which could make house flipping a flop
Increased tax rates can make the house flipping a flop. Sudden increase in the property tax could possibly affect the sale of house
You may face difficulties in finding a buyers for your house which delays the process, the longer it takes to find a buyer, more money would be at loss as holding costs