House Flipping Secrets You Should Know
Learning the secrets to house flipping, such as knowing your market, how to find the right flip, and setting a budget and sticking to it, can make many many house flippers rich! Companies like We Buy Ugly Houses and others like them have made a fortune from being real estate investors.
Learn how to start successfully house flipping below.
Know The Market
A house flipping secret is knowing your market to a tee.
So how can you determine whether it is better to buy and hold, flip, or just rent? Depending on your market, it may be better to rent a house than flip and may see longer-term income than a flip, in the right area.
Buy and Holds, Flips, and Rentals all have their pros and cons, but ultimately it all comes down to your market.
If you are in a market where there are large apartments all around, families living in those may be looking for a break into a house to rent. The market may be favoring buyers more than sellers, making a flip less profitable. In some areas as well it, the demand for houses may be so high you may get far over asking price by the time you are ready to list.
All these strategies come down to knowing your market.
A seller or buyer market all relates to the supply and demand for real estate locally.
A Buyers market is similar to where the demand is low, and the supply of houses is high. While a seller's market is just the opposite. In a seller's market, the supply of houses is less than the demand for them, so buyers are willing to pay more.
It is important to understand the pros and cons of selling to a real estate investor. You need to know the downsides so you can combat them when buyers are questioning you.
You can also use the demographics of your market to see how many people are renting, or moving in and out of your market as well, giving you a sneak peek of how many houses are available for how many people will be looking for more rentals. For anyone looking to be successful in real estate a deep understanding of your market is a necessity.
You can learn more about how to understand your market in more depth here.
Know How To Find A Good Flip
Finding Good Flips can be a challenge for those who are used to looking as homebuyers instead of flippers. Ultimately a flip that has what real estate experts call ‘good bones’ and is in a great location has a higher chance of making a profit than others.
“Finding a good flip is similar to a modern-day gold rush. While many homebuyers see houses in need of maintenance and repairs, house flippers can see dollars coming in or out of their own pocket. House flippers who can see past the cosmetic can find a true diamond in the rough, that is a deal just waiting to happen.” says Loren Howard, Prime Plus Mortgages - Bridge Loans Arizona
What do house flippers look for in a potential flip?
A House flipper looks to make sure that a flip has good bones, and not too many large repairs.
‘Good Bones’ means that the house structure and foundation is in good shape, a house with these issues can be budget killers, and cost a lot of money! Other things that house flippers will keep an eye out for our plumbing, electrical, HVAC, roofs and other costly issues. These repairs are integral to the success of a flip and are extremely time-consuming to complete.
Successful House flippers aren’t as worried about the colors and themes of the house, as they are going in knowing they will repaint and repair most of the house before they list. For most house flippers, having a flip with ‘good bones’ is far more important than the layout of the home.
Having a great location sounds great, but how do you know if a flip is in a good area?
Generally, a flip in a great location will be easy to access, be in a low crime area, with lots of amenities, and in a great neighborhood. That means short commutes, with stores, restaurants, and gyms nearby. Safe neighborhoods with lots of curb appeal and would be ideal to take a dog on a walk through. Top Rated schools and good schools in the area will also be a major selling point for a home as well!
Finding the perfect house to flip may seem like a daunting task, but may successful house flippers have perfected finding them.
House flippers often depend on wholesalers to find and have great properties to flip for them. Saving them valuable time and resources. Wholesalers will find properties and move them quickly, with most houses being the perfect find for flippers!
If a potential flip is in a bad location or has too many large repairs, successful flippers know when to walk away!
Know The Trends
Successful House Flippers know how to make their flip irresistible for their market and a jaw-dropper for homebuyers.
By following the trends, house flippers can make a profitable flip time and time again.
Successful house flippers, know how to be trendy without creating outdated flips. This Scottsdale hard money lender recommends staying away from artsy, or themed flips, as these look outdated in a short period of time. Instead, they suggest that neutral timeless looks, using cool tones, and clean finish is a way to appeal to more buyers!
Zillow reports that dark gray homes sell for more than other colors, and can add up $3,496 in value. Gray and cool tones are perfect neutrals for homes, making them easier to sell because of their trendy timeless appeal that is easy to combine and match with any style of a room.
Another way to create successful flips is to add a bit of wow factor to each flip. This can be easily achieved by adding vanities, and islands to their flips. Top house flippers understand how to budget in these showstoppers, and not go overboard with the special features in a home. As HGTV reports “Less is more. You may not get all your money back, but you do increase the marketability of your home.”
By utilizing the current home trends you can have a flip that sells for more and sells faster than an outdated home.
For those looking to make fast cash selling homes these house flipping secrets make it easier than ever to start house flipping, and know how to make a profit.
Follow these 3 secrets to become a successful house flipper:
1. Knowing the Market: Know if you are in a seller or buyer market and what type of investment is best for the area.
2. Finding Good Flips: Look for houses with good bones, and in the right locations
3. Know The House Selling Trends: Gray paint, vanities and islands can be a bit costly at first but greatly improved the marketability of your investment!
Have you ever Flipped a house?
About the author: The above article on house flipping secrets was written by Catherine Way. Catherine graduated from Michigan State University with her Bachelor’s of Advertising with a specialization in Graphic Design. She works as a freelance content creator for many facets of real estate, including commercial, residential, and mortgage industries. She spends her free time finding new ways to talk to people, through writing, designing, dancing, and more.