If you are new to house flipping, you’re likely wondering right now how you can make money from it. Believe it; house flipping can be very profitable, but it’s also a very risky venture. You need to know what you are doing.
Here are four smart ways you can guarantee a successful flip each time.
Plan your repairs very carefully
Perhaps the biggest mistake rookie flippers make is under-improving, over-improving, or making the wrong improvements. You need to know which upgrades can boost the home’s value. An upgraded HVAC system, for instance, is a strong selling point, as is a renovated kitchen and bathroom. Working with the right HVAC companies in Montgomery, AL, such as AirNow Cooling & Heating, as well as construction contractors for the renovation projects is essential.
Keep a budget for the holding costs
If you are using financing, remember to factor in the holding costs. These include utilities, HOA fees, landscaping maintenance and mortgage payments. Keep in mind that the real estate market can be unpredictable, and sometimes one has to wait for a buyer longer than anticipated. If you fail to budget for holding costs, you risk ending up short on money.
As you are still new in the industry, it’s best to avoid doing something too big. A single family home with a renovation cost of $50,000 or less, for instance, is perfect. Buying a huge property that will cost a fortune to rehabilitate can be problematic to an investor who’s still learning the ropes.
The best way to invest wisely is to set aside adequate time to learn about real estate, especially flipping. Take courses that you need to improve your flipping skills. Research online and read relevant books on the business. Get familiar with the jargon. Becoming a pro takes commitment.
The fix-and-flip business can be both lucrative and exciting, but you need to master the basics to become successful. It’s something you can do with determination and research.