More Tips for Flipping
How to go
about house flipping process
Thanks to TV shows that showcase the art and science of
flipping, many amateurs believe that they, too, can, take on the task of flipping a property with the goal of
making a little money for themselves. The trouble is, flipping a house is never as easy as it looks on TV. There
are lots to consider and it’s important to go into the process with your eyes wide open.
Know the numbers
Television shows will give you the impression that flipping a
home is as simple as buying a property, spending a
few days fixing it up and turning around to sell it for a huge profit. That’s a far cry from the reality of
flipping houses. If what you see on TV seems to good to be true, that’s because it is.
|The goal of house flipping process is to make money, so
you have to
carefully choose your property to flip. (Image by
In real life, flipping properties costs money. It’s important
to go into the process with a clear idea of all of the associated costs. These include:
The costs of actually purchasing the property. This could
include inspection, mortgage, lawyer fees, closing costs, title searches, survey costs, and more.
Flipping a house brings with it lots of expenses. While you
renovation, you’ll have to pay the mortgage, taxes, insurance, etc. on the flip as well as your own housing costs
at your primary residence.
When you sell, you’ll have to consider that your selling price
will be sliced up to cover things like real estate commissions for agents such as Colin Crowell.
Keep track of your expenses
It’s very important to keep track of what you spend during the
flipping process. Have a budget and stick to it. It’s very easy for expenditures to get out of control, so you
should always keep accurate lists and records to keep yourself on track. When you know how much you have spent
during the renovations, you can better gauge how much you will have to sell the house for in order to recoup your
costs. The less you can spend on renovations, the more profit you will make on the sale without having to charge an
|To avoid unexpected, costly and involving renovation
inspect your potential property first (Image by
Just as with any renovation
project, flipping a house can bring with it
unexpected challenges – and expenditures. Because of that, it’s important that you have a reserve fund in your
budget to deal with extra, unexpected costs.
For example, what happens if you tear out the kitchen cabinets
only to discover that the wall behind them needs to be replaced? Or, what if you take up carpet and discover that
the subfloor isn’t what you expected. What if you discover mold? All of these things can easily add up to extra
expenses, so it’s very important that you prepare for these contingencies and have money set aside to deal with
Flipping houses can be a rewarding way to make a lot of money fairly quickly. To be
successful, you’ll have to go into the process with open eyes and with realistic expectations.