One of the best ways to get a return on an investment is real estate. Some investors have found that in a market that is full of inventory there are deals to be made. Buying a property that is run down, doing repairs on it and reselling it is know as flipping the property or Flipping Houses 101 as we refer to it in this article. It can be a difficult business, but with some practice it could be lucrative.
The housing market fluctuates with inventory levels and when the market has a lot of properties it is easy to find a deal. But when inventory is low an investor has to be more creative in finding a good opportunity. Finding a deal, fixing it up, and selling it for market value, or a little less, can make an investor a good profit.
People used to utilize the Multiple Listing Service, or MLS, to find properties for sale but with added competition people are bidding in auctions and purchasing short sales. Short sales have an element of risk to them as they can take several months to close and then there is no guarantee that in the end the house will be acquired.
Before purchasing a house the investor should have an idea of what they can sell it for. Enlisting the help of a real estate agent to get comparable sales in the area is a good idea. Another idea is to hire an appraiser which could cost a couple of hundred dollars. Be ready for lots of paperwork, permits, and insurance coverage for the property after it is purchased.
Keeping the job on time and managed well is critical and that is where a good project manager and contractor come into play. Someone needs to be on site to manage the workers, make sure things are getting done in order and on time. They should also be able to handle problems and find solutions should they arise, and they will. Working smartly will reap the biggest rewards.
A 15 percent profit is considered the least amount of profit that a flip should produce. Make sure to buy in an area that is desirable to buyers, location is very important. Remember to make the outside as appealing as the inside, curb appeal is important as it is the first thing people see and the home should be inviting.
When selecting interior designs it is best to remain neutral and think of what will appeal to most potential buyers. Kitchens and bathrooms done well will increase the value of the house. Fixtures and appliances should match and be of a good quality. Starting small and working up to more difficult projects is a smart choice when flipping. The first project should be mostly cosmetic changes, a lot of lessons will be learned in Flipping Houses 101 that can be used on future flips.
The housing market fluctuates with inventory levels and when the market has a lot of properties it is easy to find a deal. But when inventory is low an investor has to be more creative in finding a good opportunity. Finding a deal, fixing it up, and selling it for market value, or a little less, can make an investor a good profit.
People used to utilize the Multiple Listing Service, or MLS, to find properties for sale but with added competition people are bidding in auctions and purchasing short sales. Short sales have an element of risk to them as they can take several months to close and then there is no guarantee that in the end the house will be acquired.
Before purchasing a house the investor should have an idea of what they can sell it for. Enlisting the help of a real estate agent to get comparable sales in the area is a good idea. Another idea is to hire an appraiser which could cost a couple of hundred dollars. Be ready for lots of paperwork, permits, and insurance coverage for the property after it is purchased.
Keeping the job on time and managed well is critical and that is where a good project manager and contractor come into play. Someone needs to be on site to manage the workers, make sure things are getting done in order and on time. They should also be able to handle problems and find solutions should they arise, and they will. Working smartly will reap the biggest rewards.
A 15 percent profit is considered the least amount of profit that a flip should produce. Make sure to buy in an area that is desirable to buyers, location is very important. Remember to make the outside as appealing as the inside, curb appeal is important as it is the first thing people see and the home should be inviting.
When selecting interior designs it is best to remain neutral and think of what will appeal to most potential buyers. Kitchens and bathrooms done well will increase the value of the house. Fixtures and appliances should match and be of a good quality. Starting small and working up to more difficult projects is a smart choice when flipping. The first project should be mostly cosmetic changes, a lot of lessons will be learned in Flipping Houses 101 that can be used on future flips.
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