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Flipping Houses: How To Profit For Beginners Part 2
What kinds of homes are being listed in your area that are a potential profit maker? Look at your local newspaper’s real estate advertisements or check out real estate listings online.
Take a drive around neighborhoods that are near schools, business districts and shopping establishments. These areas have potential to make money as many home buyers consider the convenience of the neighborhood.
Flipping Houses-Looking for Houses to Flip
Drive around neighborhoods and look around. If you’re lucky, you may find a for sale by owner house. This seller wants to bypass using an agent to perform the transaction.
The seller may be knowledgeable with performing transaction or a real estate attorney is involved. Something worth checking out or negotiate a price.
So, you look online and through the local newspaper and can’t find a potential property. The cost of real estate is through the roof! You ask yourself “How the heck am I going to afford these advertised property costs”?
First of all, take your time locating and researching properties for sale. NEVER jump head first into a flip without having your plan in place.
Where to Get Inventory of Houses to Flip
County Tax Liens – Visit your local county’s website on real property tax. It’s possible to locate property with liens. You can research their web site and find information to participate in auction of properties.
Foreclosures – Look at your local newspaper for properties that are headed for foreclosure. You can find dates and times for inspection of property and the auction. You can also visit popular websites like Zillow to find properties in your area. Build a business relationship with a local licensed realtor to assist you with transactions.
Network – Get the word out! Let people know that you are looking for property to buy. Inform your family, friends, business associates and realtors of the type of property you’re looking for. By networking, you create a constant flow of possible flips. Open yourself to visit properties and evaluate its profitability.
What Do You Know About The House?
When shopping for properties to flip, there’s more to a structure than what is standing on the lot. Get an idea of the condition of the house and lot. When viewing the house from all side views, what are you viewing that’s abnormal? The house leaning to one side can mean there’s a foundation issue. Pay attention to cracks in the foundation as these need to be addressed first prior to any repairs.
Follow Up On Your Flipping Skills
Evaluate the abilities and skills that is required to make the flip. First and foremost, how are your negotiating skills? A profitable flip begins with the purchase price of the property. The lower the price you buy, means a potential profitable flip. Determine an acceptable price to purchase the property.
Keep in mind ALL the cost that are involved. Cost such as closing, designing, renovation, labor and interest should be factored into what constitutes your buying price. Get a handle on the expenses as this will determine how you make money.
Determine your involvement in the renovation
There are large cost savings if you have the skills to run the project from start to finish. If you are new to flipping, you can learn jobs skills for free! Take the time to learn the different skills required for flipping. Learn skills in negotiating, finances and home repair. Taking the time to learn can help the business to become more profitable.
The home will need to conform to building codes. Make a point to learn and gain basic knowledge of the building codes for your area. Most of all, you want to network. Develop a working relation with businesses and individuals that will help your business grow.
The Anxiety Of Flipping This House
Did someone say flipping homes is easy? Watch those popular flipping homes reality series on television and get an idea. These business partners or spouses experience stress and anxiety. Loan payments need to be made. The project goes over budget and get the home to pass building inspections. These are a few issues that can create anxiety.
Have a formal plan on how deal with these situations. Have a business plan to deal with issues prior to the flip as this plan will become your rule book for your projects. Your plan is where you go to when you’re stress and unable to make acceptable decisions. Plan to succeed with flipping homes!
Flipping Houses: Sub-contracting For A Quicker Flip
Flipping homes is more than a one man show. Time is valuable when flipping homes. It results in income made or loss. This depends on the turn around. Get people to do the work on the property. By sub-contracting, you are hiring a contractor or paying reputable individuals to complete work on the home. You can sub-contract a portion of the required work such as electrical and plumbing to these experienced individuals.
Communicate clearly the time frame, goals and design work that need to be accomplish. You may need to obtain bids from several contractors to get price options for your project. To make money is your primary goal.
Do I Really Have To Flip This House?
Maybe you changed your mind? Circumstances change. So, make a decision to rent out the home instead. Because the purpose of rental income or near term appreciation of property value is to generate income. A property located in a neighborhood near schools, business and shopping establishments can command valuable rental income.Rental income in these neighborhoods can be high. If you bought the property when market value was down, you can hold the property, renting and sell later. Above all, chances are better that profit margins are lucrative when you hold. Remember, your goal is to make money.
Post Flip Evaluation
After your flip, take the time to evaluate your flip. Write a brief summary of your flip from the purchase to the sale of the property. Note the positive situations that were beneficial to the flipping process. Situations like working with a certain realtor, banker, contractor, building supply company etc. Be sure to log the negatives or setbacks that you encountered. Log down what you did to overcome these setbacks. Doing the evaluation is creating a tool or reference for your business. This log helps you & your workers should you encounter the same situations in the future.
Have an open mind. Take opportunities to learn more and teach your workers to become effective and efficient. Grow and become successful! Keep in touch with the news on the real estate market. Have knowledge of what is happening in the market and regulations in your area. Knowledge is key to help you and your business to be profitable and make money.