Fix and Flip Tips and Tricks
Buying a home to fix and flip in an uncertain real estate market can be a risky venture. Add backbreaking work, and unexpected structural defects and you have a mix of elements just right for huge success or heart rending failure. Here are a few tips and tricks to help you succeed in your flipping adventure.
Location can be one of the most important factors in flipping a home. Improving a house with up-to-date renovations is only part of the full package when trying to sell the building. Curb appeal, schools, traffic, and safety are often essential to buyers. Therefore, choose a home in a desirable neighborhood before investing any money.
All renovations are not created equal; in fact, some updates and repairs may be costly and can add almost no value to the house. Buildings requiring rewiring, a new roof, or structural repairs are often called “money pits” and ignored by fix and flip experts. On the other hand, kitchen and bathroom renovations can often add a great deal of interest in the home with very little money expenditure when cabinet doors, paint, and plumbing hardware are all that require updating.
Home makeovers can quickly get out of hand when you become invested in the property. One secret many real estate flipping experts use is to get into the project quickly and turn the property around as soon as possible. It can be difficult to walk away from a fix and flip project if you have the idea that just one more improvement could help the home sell for a great deal more money. Experienced flippers suggest making a healthy profit is about putting just enough improvements into the house to help it sell, but not so many that you don’t make your money back.
Another helpful trick is the art of negotiation. The more money you can save in building supplies, contract labor, and real estate costs, the more money you can make. Learning to haggle effectively can also prevent those working with you from taking advantage of you.
When meeting with a real estate agent to value the pre-flip home, take care not to press for the agent to over-value the property. Also, know the type of homeowner your renovated home may attract because first-time buyers may seek a very different house than a third-time home buying couple with children.
A fix and flip venture can be an exciting, money-making experience for anyone willing to invest the time and money into the project as long as the manager protects himself or herself. Knowing some of the tips and tricks of the trade can save an investor a great deal of money and time.