These days, most of what people learn about flipping houses comes from popular TV programs, making it look like a simple process. While these shows do raise the awareness of house flipping, they often do not paint an accurate picture of what it entails to flip a house. If you are looking to get into the flipping game, make sure you know a few critical “must-dos” before you sign on the dotted line.
1. Know How Much Cash You Need
One of the most important aspects to secure before you begin your journey is to make sure that you have enough funds for taxes, utilities, and mortgage payments, for as long as you own the property.
You should also create a realistic deadline for when the work should be completed to make the house sellable. You should also establish a drop-dead date in which the house must absolutely be sold. If the home stays on the market longer than this date, it will begin to eat into your profits. If you aren’t adequately funded, you could find yourself in a sticky situation.
2. Know the Neighborhood
It is also imperative that you do your research on the neighborhood and all surrounding areas. If you aren’t familiar with the area, you might end up with a few unwanted issues. There could be industrial parks or construction in the area that could end up impacting the sale of your home.
3. Study the Comps
Comps are the comparable properties in your area and should be studied before you purchase. It is essential to know how long similar houses stay on the market and how much they sell for. Doing a bit of homework can maximize your profit and determine how much you spend on the property’s renovation costs.
4. Have Solid Improvement Goals
Over-improving a house can be just as bad, if not worse, as under-improving a house. If you don’t make every effort to make your house fit appropriate goals, potential buyers will not be drawn to your house. If you over improve your house, you will also cut into your profits and leave behind money that could have otherwise been a part of your profit.
5. Focus on Curb Appeal
As the old saying goes, you only get one chance to make a first impression. The same is true for potential buyers, and it could make the difference between making or losing a sale. It is always important to consider things such as painting, landscaping, and even interior items such as curtains and blinds.
6. Understand Your Audience
As much fun as it can be to add personal touches to your restorations, it is crucial to understand that your tastes aren’t for everyone. Designs that are too trendy or overly specific can end up turning off potential buyers. In this case, neutral is usually the safest bet.
7. Understand Taxes and Fees
Before you ever think of investing in a property, it is crucial first to understand the property taxes in the area. If they are too high, it could actually discourage any potential buyers. If the house doesn’t sell, you will be stuck footing the bill for the taxes as well. You should thoroughly understand the tax rates and any fees associated with the Home Owners Association in the area.
8. Research the Schools
Schools are a huge selling point for homes, and the better the schools are, the more interested family buyers will be. Always keep this in mind when you are looking at potential properties. If you are selling a home in a lackluster school district, you won’t lose all interest, but you will be selling to a different audience.
9. Know Your Limits
Do not attempt projects that you aren’t qualified to do. Leave the plumbing and the electrical to the professionals.
10. Don’t Be Too Greedy
There is no way to beat the market, no matter how much you put into the property. The market will ultimately decide the price that the home will sell for. You want to price your home competitively because an overpriced house will sit on the market for ages.
Final Thoughts
Flipping a home can be a delicate and challenging process, but it can be profitable with a bit of planning and homework. If you are looking for expert flipping advice, the Safetynet Group specialists will be there every step of the way.