Flipping houses is simply buying a house that is under market value because it needs repairs and major refreshing, then doing the necessary work before selling the house for a profit. Flipping houses has become a somewhat common practice, prompted perhaps in part due to the popularity of over 100 flipping shows on the HGTV network, now the third most-watched cable TV channel in America.
Flipping Houses—Some Cautions
Achieving success in flipping houses comes with some financial risks. It isn’t passive investing, and it isn’t as easy as it looks on TV. It takes a lot of time and close management. So, it can’t be approached as a little “side hobby.” It also requires construction and remodeling skills and the right timing.
Flipping Houses—The Beginners Guide
To succeed in flipping houses (meaning to make an attractive profit,) consider these guidelines:
Develop a business plan, including your objectives, financial resources, target geography, a market analysis, property niche(s) to be developed, and an action timetable. Then, stick to this plan.
Work hard to find good deals. That means finding the right property at the right price to render a profit. This search may require multiple sources like the MLS, foreclosure lists, real estate professionals, short sale negotiators, and house auctions.
Analyze potential deals:
What is the current property’s value in its current condition?
What will you need to pay for closing costs?
How much will renovations cost including materials and labor?
Calculate the property value after repair costs, and other costs of time and property holding such as utilities. Also, add-in selling costs.
Seek commercial funding sources.
Get the work done by professionals. This is typically not a DIY business.
Act fast, understanding the time value of money.
Prepare to manage risk.
Seek Expert Financial Assistance
Contact Evolt Capital, to get the capital for your business vision. We have an experienced team of professionals who are skilled in commercial finance and we offer a comprehensive portfolio of loans to meet your objectives.