If you’ve ever thought about flipping homes for profit, you’re not alone. Every year millions of new investors get their start in the real estate industry, and many ultimately end up doing it as a full-time living. But if you’re going to jump into the home-flipping market as a beginner, you’ll need to know how to do it right so you can give yourself the best opportunity at succeeding with it.
Table of Contents
Intro into Real Estate Investments
When first starting out as a home flipper, you should familiarize yourself with how most real estate investments work. Some investors try to time the markets by buying properties when national home prices are cheap and then resell them for a profit later when prices have risen.
However, this can often take years of patience and waiting, and that’s assuming that you’ve correctly predicted the right time to buy. Instead, many real estate investors choose to spruce up underappreciated homes and then resell them once they’ve been revitalized.
Finding Fixer Uppers
Your first order of business should be to find fixer-uppers, which are undervalued homes that may need some care and maintenance. Real estate brokers normally locate these by using online directories, known as multiple listing services (MLS), but access is normally restricted to only those who have a real estate license.
As an unlicensed beginner, you can bypass this by attending real estate auctions, skimming through real estate marketplaces online, or even looking for properties with delinquent taxes through your local tax assessor’s website.
Using Software to Make Things Easier
Instead of scouring through thousands of property documents or websites for good deals, professionals often use software to gain an advantage in the markets. According to DealMachine, their house flipping software includes a map feature that allows you to find properties and “automatically see which ones are vacant, behind on taxes, and more.” These types of programs can simplify the house-hunting process, so you can quickly find bargains before others do.
Renovations
Revitalizing distressed properties by renovating them is the most important ingredient in any home flipper’s recipe. This is where most of your money will be made, so you need to financially and strategically plan out how you’ll renovate before you do it. Hiring a surveyor is a wise idea because they’ll be able to assess any issues that a home has, such as structural damage, mold, and pests. Once you’ve calculated the costs to renovate, you can then hire contractors to do the work and have an inspector sign off on everything once it’s all finished.
Selling for Profit
After all your hard work in getting your new property ready for sale, you’ll now need to put your home on the market. While many people simply put a “For Sale” sign in the front yard and hire a broker to take care of all the leg work, taking a more proactive approach may be more profitable. There are many different online real estate marketplaces where you can list your home, and many of them will submit your home to the MLS directories as well.
Patience is a Virtue
As a final note, you should always try to practice sound judgment when flipping homes, as it’s emotions and impatience that often lead to mistakes in this business. Being too eager to buy a home quickly instead
of waiting for the best possible deal are just some of the mistakes that all first-time home flippers should be careful to avoid.
