If you’re new to flipping houses, it’s natural to wonder what’s in store. Below, you’ll find a rundown of several things you should expect.
Homes with Issues
Sometimes, flipping houses means you’ll run into homes with significant issues. Even one that looks like a dream deal from the outside may have plumbing, electrical, or structural issues on the inside. Therefore, it will behoove you to put some effort into securing a thorough inspection from a reliable professional before you buy a property. Also, set aside funds for potential extra costs during the renovation phase. That will keep you covered in case an issue that was impossible to spot before the purchase comes up.
Some things will be outside of your control when you’re flipping houses. One of those is how long your for-sale homes sit on the market. Keep that in mind while you’re evaluating properties to purchase: You’ll want to have room in your budget to cover costs like mortgage payments and utility bills until the house sells.
The Importance of Research
Flipping houses successfully relies on research. Among other pieces of information, you should know:
- How much a home is likely to sell for, given its size, condition, and location
- Which renovations will add the most value and which aren’t worth the effort
- What events, like a school opening or a business leaving, may affect the value of the home
Flipping houses is not a solo venture. For instance, along with a good inspector, you’ll also want to find a reliable realtor, a title and settlement company, and a real estate agent. Wholesalers (who scout houses) and contractors (for renovations) are invaluable as well. Also helpful are house stagers and people who can expedite permitting processes. Forbes has assembled a comprehensive rundown of what makes for a good house-flipping team, so check it out.
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