25 Aug Do’s and Don’ts When Flipping a House
Summit Capital is a local, family owned, MA and RI Hard Money Lender specializing in creative real estate funding for both the novice and seasoned investor. We will work with you to ensure that you get the funding you need at the most aggressive terms possible for your real estate investment.
As a service to you, we offer this list of Do’s and Don’ts to help you move forward with your house flipping project.
The Top Do’s and Don’ts When flipping a house
We all know that flipping a house can have big rewards; but what about the risks involved? With this in mind, we have put together our list of do’s and don’ts when flipping a house. Wondering where to buy and how much to DIY?
When the housing market was on the upswing in the late nineties and early 2000s, it was easy to make money. People were making fast and big profits on their investments. Then the market crashed and everything changed.
Because of this it is important to use due diligence when making this kind of investment.
Do Hire a Trained Home-Stager
There are many real estate agents that are trained in the staging process. Make sure you find someone who has the background to do this right. A home that is staged and furnished correctly will sell quickly, and this is what we want.
Don’t be afraid to “low ball”
If we don’t ask we will never know if the offer will be excepted. The seller may be insulted, but maybe they won’t and you can save thousands, just by asking. Just be careful because in a “hot market” low balling could cost you the deal.
Do know what you’re getting into
Make sure you find out what renovations the house needs before you buy. Sometimes the necessary improvements are so expensive that the deal just wouldn’t make financial sense. Bring a contractor with you when you tour possible flip properties to determine the extent and cost of needed repairs.
Don’t take on something you cannot handle
Know your experience level and don’t try to do a complete gut down to the studs on your first flip, Make sure you always consult with a professional before moving forward on homes with construction issues that you are not familiar with because things like; foundation, support beams, asbestos or mold issues could cost you dearly.
Do keep location in mind
We all know that location is key to selling a property, but how do we know when we are getting a good one? Try looking for dilapidated homes on nice or up and coming neighborhoods. Flipping houses in these areas can only have an upside. Also don’t over improve your house, unless you are 99.9% sure you can recoup the costs.
Don’t hold it too long
Keep in mind the golden rule of 180 days. 60-90 days for renovation and another 60-90 to sell. You can’t make money by holding on to properties too long. If you keep up a quick pace, you will be on the road to success, in no time.
Don’t get in over your head with DIY
Long hours spent on DIY remodeling projects — can lead to a bigger profit margin, but only if the work happens quickly and looks as good as a professional job. If you are confident in your abilities then go for it, but make sure you know what you are doing before you get in too deep.
Do secure your financing ahead of time
Contact us today to get your financing secured before you find that ideal property.
If you have your money set up beforehand you can move quickly when you find the right property. Winging it probably won’t yield the best results. There is nothing more frustrating than finding “the one” and not having the cash to move forward on it.