8 Things you must know before flipping a house
MONEY + MATH.
As obvious as it sounds that you need money before you can flip a house not only for the house but for other expenses. Have a quick look make sure you can answer all these questions.
How are you paying for the house. Are you paying with cash? Are you getting a conventional mortgage or are you getting a bank loan? How much is the rehab budget? Do the math, make sure you understand the cost of the the property, loan payments, rehab cost, and all the taxes, bills and fees ( heat, water ) for the house, plus as a little budget for miscellaneous. something always comes up.
A GOOD AGENT.
Finding a good agent can be hard. There are many many agents out there, so you have a lot to choose from. Once you have bought and sold a few houses to flip will figure the difference between a good agent and a bad one.
One of the best ways to I found over the years to find a good agent is still to just ask my friends to see if they've used anyone that they would recommend word-of-mouth it's always works for me. I have given my agents number out to many many people. Another good resource is obviously websites. it’s always good to read reviews and see what other people think about the agent you're thinking of hiring. Always remember that the agents are supposed to work for you. Some agents have a knack of making you feel bad for wanting to look at lots of houses. If that's the case maybe that's not the agent for you there's plenty out there that will help you.
Local Market Knowledge.
Before you go out and buy a house to flip make sure you do your homework make sure you understand the market of where you are trying to purchase the house. It's great finding a cheap house, but are you going to get your return on investment. You know what they say… location location, location. Do your homework talk to your Agent. Check out the comps in the area make sure you're going to get enough money back at the end of the project. Have a conversation with the neighbors about the area always still great resource.
Contractor, Handyman, Plumber, Electrician, Painter, Roofer
Well you know the saying it takes a village to raise a child. It takes a town to flip the house. Whether you're doing the work yourself or subcontracting it out. You're going to need a good team behind you. make sure you find the right guys to do the job. A good mortgage, accountant, and insurance person are always a must as well as a part of your team.
Side note. When it comes to houses if you don't know what you're looking at. Always, always get the house inspected by a professional.
THINK ABOUT THE BUYER.
By now maybe you've gone out and purchased a house to flip. you have done the math you've teams behind you, your ready to go. Now it's time to start designing your flip. Always remember that you are selling this house. Try to imagine what type of people are going to buy the house.
If your house is in an upscale neighborhood your going to have to spend money on a scale finishes such as granite countertops and stainless steel appliances .
if you're not in such a high-end market may be Formica and cheaper appliances can be used. Sometimes it's hard to rain yourself in when it comes to the finishes but remember the end of the day, the more you spend, the less you make. That being said don't be cheap buyers know good quality finishes versus big box store junk.
PRICE THE HOUSES RIGHT.
This is probably one of the hardest things house flippers have to deal with. Whatever your first time flipper or you've been doing this for years. Setting the price on the property is very difficult. You want to make as much money as you can and sell the house fast. Do the math, how much did you spend on the property? how much did you spend on the rehab? Look at all the comparable houses in the area that have the same amount of bedrooms, bathrooms and the same size as your property. This will give you a good idea of what you can sell you houses for. You don't want to shoot for the moon and have the house on the market for months at a time but you also don't want to leave money on the table. Take your time. Listen to your agent they probably know the market much better than you do. Always remember you can always drop the price you can never raise the price.
THE THREE Os
On budget, on time, on the plan
Flipping a house is not for everybody. I know you see TV shows where they flip houses in half an hour and make tons of money. The reality is so different, it's a messy painstaking process to take the house from crap to nice. Take a long time to think about whether you really want to do this. Make sure you have enough time. If you do decide to go ahead and flip the house that can be very rewarding both financially and the satisfaction of taking an old house back to its original beauty.
Whatever you decide. keep coming back to my flipping houses.com we can help you every single step of the way good luck.