If you don’t have any experience flipping homes — or at least, any legitimate experience involving lucrative success — you may be unfamiliar with some of the best practices associated with this process, or even just where to begin. Home flipping isn’t anything new to the scene, of course — given the steady improvement of the housing market since the 2008 economic recession, countless properties have been available to purchase for nothing shy of dirt cheap. This presents an enticing real estate investment opportunity.
Home Flipping As Seen In The Public Eye
Your desire to start flipping homes may have even been inspired by reality TV shows about house flippers and their related struggles. Popular shows like “Flipping San Diego” and “Flipping Boston” have increased the public’s awareness of just how doable it is to buy a home at a price that’s significantly cheaper than market value, put some money into fixing it up, and then selling it at a nice profit.
Real Estate Flipping Made Easy Thanks To Private Funding Consultants
Whatever your background is when it comes to your interest in flipping homes, rest assured that there’s a team of dedicated real estate consultants ready to help you during every step of the process. From real estate advertising and listing to providing you with hard money loans to secure the capital necessary to fix up a property, Private Funding Consultants has helped countless real estate investors achieve the success that they deserve.
Below are several things to keep in mind as they pertain to the home flipping process. To get additional insight from our book, 7 Deadly Sins Of Real Estate Investing, sign up here today or feel free to contact Private Funding Consultants if you have any questions!
Keep Your Budget In Mind From The Very Start
By “keep your budget in mind,” really, what we mean is to not go over your budget when it comes to buying the home that you’ll eventually be flipping. You’ll almost certainly be encountering additional costs down the road including upgrades to the house or contractor costs. Unlike purchasing a home that you and your family will actually be living in, try to leave the emotional attachment component aside. Buying this type of home should be a business-focused, practical purchase, not something that you’re going to get attached to.
Before You Buy: Get A Legitimate Inspection First
Would you purchase a used car with hundreds of thousands of miles on it without getting it inspected by a reputable mechanic? You shouldn’t, because you’re likely asking for a number of issues down the road. In the same sense, the house that you’re looking into should also be subject to careful scrutiny. It’s pretty sound logic if you think about it — the average home is worth far, far more than the average vehicle. Why jeopardize your purchase by not truly knowing what you’re purchasing?
Even a few small cracks in the foundation or a leaky window could lead to major issues down the road, and it’s extremely important to have a clear understanding of what you’ll need to pour money into in order to have a house that will sell well for a price that makes it worth your while. Again, it all comes back to your budget and making sure that you know everything that will be going into it.
Don’t Pay Your Contractors (In Full) Until They’ve Completed The Job
If you’ve paid your contractor(s) up front well before their job is done, well, you probably know them personally, or maybe you have a lot of trust in them. While that’s all fine and dandy, chances are that you won’t know the contractor personally. Please, do not make the mistake of paying for important renovations when they’re not done. Usually, the best practice is to pay them partially up front, and pay the rest when the job is done — and done right, too.
Research The Neighborhood And Nearby Area
As an important part of a thorough, diligent real estate market analysis that our private lenders touched on in a previous blog post, the last thing you want to do is buy a home in an area that you’re unfamiliar with. What if there’s a dirty secret or something else going on down the street that’s going to deter potential buyers from actually…buying?
Ideally, you’ll want to invest in a home that’s either in an up-and-coming neighborhood or in an area that’s desirable to buyers and will therefore sell quickly. If a house that you’re interested in is also a short drive from a major retail center or in close walking distance to restaurants, that’s another major plus and an incentive to purchase your house.
Make Sure That You Understand The Permit Situation
Depending on what state you’re in, you’ll likely need a specific permit in order to properly (and legally) flip a home. While certain states might require that you (as a home flipping business) be licensed as a general contractor, other states may require a full-on real estate selling license if the home is being sold via a subsidiary. Remember that our team of real estate consultants can help you sift through the legalese and answer any questions that you have about permits.
Start Working With Private Funding Consultants Today!
Home flipping isn’t necessarily easy, but by obtaining house flipping loans and other helpful guidance from Private Funding Consultants, we can make real estate flipping approachable and realistic. Get started today!