If you were to stand ten house-flippers in a line and ask them what they’ve learned most along their journey, nine of them would spew some nonsense about learning from your mistakes being the key to success, both financially and personally. But, like we said, this is nonsense. Why? Because it makes a lot more sense to learn from the mistakes of others and avoid the risk that is a steep learning curve, especially with thousands of bucks on the line.
That is why we have done the groundwork for you and come up with a few secrets that will make your introduction to house flipping a success and not a timeline of disasters that maybe, possibly, leads to a career.
You Make Your Money When You Buy
The price at which you buy a property is the most important part of the flipping process. Period. That means you need to have patience and search for a property that will make for a profitable flip; a house that is under market value that you can then add value to. That is where you make your money.
Trust The Contractor’s Your Work With
Finding a contractor that is reliable, professional, timely and good value is about as important as it comes when you are trying to flip a house because both time and money are of the utmost importance. But don’t wait until you have a house to start your search; start asking around now, start getting references and start building relationships with people that you believe you can work with.
Add Lots Of Value For As Little As Possible
When it comes to adding value to a property, you need to know what is going to add the most without overspending. You want to restore a property but without over-improving it. That means knowing that kitchens and bathrooms are the best things to remodel and bringing in someone like Integrity Restoration to the work, while also explaining there is no need for marble countertops or expensive wood floors. You won’t sell a $250K house in a $100K neighborhood.
Buy In Neighborhoods That Are Good Now
The whole point of flipping a house is to get in, get done and get paid as quickly as possible, which means there is little point in trying to work out which neighborhoods will be good in the future. You want to what neighborhoods are desirable right now and find something undervalued in those areas. Just remember, what a place desirable is safety, amenities and location. Just because a house is cheap, does not mean it will make a good investment.
Networking Is Your Best Asset
You need to get to know the sellers as early as possible and the best way to do this is by networking. That means speaking to people that are more informed than Google. We’re talking real estate agents, dumpster companies, divorce lawyers, removal companies and mail carriers; anyone in the know that could point you toward a homeowner that is in financial trouble, getting a divorce, moving out and anything else that could mean a quick sale. Give them a $1200 referral fee if you must – it will be worth it, that’s for sure.
This is a collaborated post.