If you are interested in getting into house flipping and it is your first time giving it a go, there are a few things you need to think about. Whether you are more involved with the physical aspects of the house like the renovations and changes made to the structure, or you are involved in the buying and selling of the property, there are many rules that you need to follow for the flip to be successful.
Location is important
When you are buying a flip house, location is everything, so you need to buy a house in a good area. This is because when you are trying to sell your property to potential buyers, they will be looking at the location of the house so that they can live in it comfortably. Things that you might need to consider include the property’s proximity to local shops and schools, and if your house is in a good neighbourhood. This is where identifying your potential buyers could help you, because you will understand what they are looking for in a property that they want to buy. The location is one of the few things that you can not change about the house you are flipping, so think before you invest.
Inspect before you buy
You should never buy a property without inspecting it, even if it is for a house that you are looking to flip. This is because you need to make sure that there are no nasty surprises that could cost you a lot of money when it comes to renovating your property. For example, if your house has some plumbing issues that you didn't know about before you bought the house, you could be spending hundreds more than you were hoping to spend because you didn’t look properly when you inspected the house. Another thing that you might want to do before you start making any changes is to get your house evaluated. Most people try to determine the ‘After Repaired Value’ (ARV) before they invest in a property so that they can figure out if the investment is worth it before they actually purchase the property.
Create a budget and business plan
Before you flip a house, you should create a budget and a business plan. To create a budget, you need to calculate the rough costs of each part of the renovations and changes that you are making to the property. You can also get quotes from most people that could do some work for you before you hire them so that you can get the best deal for each part of the process. Then you need to create a business plan to make sure that everything is sorted out and straight forward before you start to do anything with the house. Creating a budget and business plan before you flip your house will help you to know what should be happening and when, and how much money you will need to have to prepare for each part of the job. That way, you won’t be surprised
Select properties that are easy to update
Finding a property that is easy to update is very important because it means you will have to do less work and put in less money to make a profit. It is often said that you should look at the walls, ceilings and floors in property to determine if it is sound because they will show signs of any structural issues that may be affecting the property. You only want to spend a little bit of money to update the property with a few coats of paint, some new hardware and some lights. These things can make a big impact and are easy to change in a home that you are trying to flip, so spending money on them can make a real difference. The key is to know what to improve and what can stay the same so that you don’t spend too much on unnecessary things.
Build a strong team
Having a strong team behind you when you are flipping a house will make the process a lot easier on you. For example, in the process of flipping a house, you will need to find a contractor to help you oversee any improvements to the property, and you will need to develop a relationship with a real estate agent before you sell the property. Other people that you may need to add to your flip team include; builder, property inspectors, designers and architects. You should also be hiring people to help clean up after renovations to your flip house. Rubbish removal specialists like 1300 Rubbish are good to have on hand when you are flipping a house because they specialise in removing rubbish from construction sites and residential areas. The key is to find people that you can work well with and that you can trust to do a good job because they will be a crucial part of your flip.
There are several rules that you need to follow when you are flipping a house for the first time. Some of these rules are for your safety and peace of mind so that you don’t get ripped off or people don’t take advantage of you. Other rules are in place to ensure your success with the flip so that you can make as much money as you possibly can. If you stick to the major rules of flipping a house, you will be more likely to break even and get a decent return on your investment, rather than losing money and being unsuccessful with the flip.