The toughest decision you’ll make when rehabbing properties is choosing which house to buy. You want to find a bargain property that needs work – but not so much work that you lose money on the deal. Picking a property may make all the difference in your next flip, so follow these real estate flipping tips when you’re rehabbing properties:
- Consider your area. Before you purchase any properties, make sure you research your area. Each city – and perhaps even neighborhood – will have its own characteristics and average price. It’s crucial to know your neighborhood, otherwise your “good deal” might end up costing you quite a lot for the area.
- Look for properties in need of work. You may be able to find houses to flip by driving around and looking. When you see a property for sale that could use some exterior cosmetic upgrades, that’s a sign that it may be ripe for a flip. Homes that appear to be in poor condition may be structurally sound and ready for renovations.
- Buy a home that will sell around the average. Conventional real estate flipping tips tell you to look for a home that will sell around the average price for the neighborhood when you’re done making renovations. If you price too low or – worse – too high, you risk losing money or not selling the house. When you’re sitting down to make your budget for the flip, make sure you’re not putting in upgrades that will make the home too pricey for the area.
- Focus on foreclosures. Finding a foreclosed home is every flipper’s dream. Not only can you save money, it may make rehabbing properties easier. Foreclosed houses may need some upgrades, but more often than not, they’re in fairly good condition already. Banks typically sell foreclosed homes for less than the market value, so you’ll save cash on the purchase – leaving you more money for rehabbing properties.
If you’re fixing up houses for a living, you need to be able to spot a great deal when you see one. Reading real estate flipping tips can help you figure out which properties are a good buy and which ones you should pass on, so make sure you read up before your next flip.
