House Flipping: 5 Basic Tips To Know
"Flipping houses" refers to the practice of buying a home, fixing it up, and selling it for a profit. In theory, it sounds like a relatively easy way to bring in some extra income. In reality, flipping houses can be a lucrative venture, but there are several important factors that should be closely considered. Here are a few tips for any of you thinking about flipping houses at the Lake of the Ozarks.
Tip #1: Know Your Budget
Before you even begin shopping for potential homes, take a close look at your financial situation. What is the total amount you can afford to spend out of pocket? This total amount should cover both the cost of the home itself and ensuing repairs. Once you have this number, you can begin breaking it down into how much you want to dedicate towards repairs and how much you want to allocate towards the down payment and closing costs for the property itself. This will help you find homes that are actually in your price range.
Tip #2: Know The Market
Every real estate market is a little bit different. If you are planning to flip a home, you'll want to find one at a cheap price (possibly a foreclosure) that is in a good location. Ideally, it should be in a market where surrounding homes have been selling relatively quickly and steadily increasing in price. Once your home is ready to sell, you'll want to find a buyer as quickly as possible. The longer a home sits on the market, the more it will cost you in terms of your mortgage payment, insurance, utilities, etc. The sooner your sell, the greater your profit margin will be.
Tip #3: Renovate With A Specific Buyer In Mind
Any marketing professional will tell you that one of the most important secrets to effective marketing is knowing your audience. The same applies to house flipping. Once you know who your target buyers are, you can renovate your home specifically to their needs. If you buy a home in close proximity to good schools, for example, you may want to tailor your renovations to meet the needs of young families. If your home is in a retirement community, you may want to focus on single-level properties with open floor plans.
Tip #4: Update Strategically
Once you've purchased the home you want to flip, it's time to start making upgrades. Choosing which items to fix/upgrade typically requires a little more strategy than some people realize. Fresh paint and new flooring are essential, but if you want to sell your home for more, adding extra incentives may be beneficial. Energy-efficient lighting, a home security system, outdoor motion sensor lights, and renovated landscaping are all examples of higher-end renovations that may result in a greater return for your property.
Tip #5: Don't Overprice Your Home
After months of long hours filled with incredibly hard work, your home is finally ready to be sold. Now comes the challenging task of choosing how to price it. Because you will be intimately acquainted with how much hard work you've put into your property and how far it has come, you may be tempted to price it higher. However, your buyers will have no idea of the home's background - all they'll know is how its price compares to that of comparable properties. Overpricing your home can cause it to sit on the market for a long time. Pricing your home in the same range as comparable properties will probably be more strategic.
In Search Of A House To Flip? Let Me Know!
Flipping houses comes with a certain amount of risk, but if approached correctly, it can be incredibly lucrative. If you are looking for affordable homes at the Lake of the Ozarks that could become profitable investment properties, let me know. In my years working as a real estate agent at the Lake of the Ozarks, I have gained valuable insights into our local market. I would love to help you find affordable, low-cost properties to begin your investment journey. Give me a call at 573-216-8439 to start the process.
Tip #1: Know Your Budget
Before you even begin shopping for potential homes, take a close look at your financial situation. What is the total amount you can afford to spend out of pocket? This total amount should cover both the cost of the home itself and ensuing repairs. Once you have this number, you can begin breaking it down into how much you want to dedicate towards repairs and how much you want to allocate towards the down payment and closing costs for the property itself. This will help you find homes that are actually in your price range.
Tip #2: Know The Market
Every real estate market is a little bit different. If you are planning to flip a home, you'll want to find one at a cheap price (possibly a foreclosure) that is in a good location. Ideally, it should be in a market where surrounding homes have been selling relatively quickly and steadily increasing in price. Once your home is ready to sell, you'll want to find a buyer as quickly as possible. The longer a home sits on the market, the more it will cost you in terms of your mortgage payment, insurance, utilities, etc. The sooner your sell, the greater your profit margin will be.
Any marketing professional will tell you that one of the most important secrets to effective marketing is knowing your audience. The same applies to house flipping. Once you know who your target buyers are, you can renovate your home specifically to their needs. If you buy a home in close proximity to good schools, for example, you may want to tailor your renovations to meet the needs of young families. If your home is in a retirement community, you may want to focus on single-level properties with open floor plans.
Tip #4: Update Strategically
Once you've purchased the home you want to flip, it's time to start making upgrades. Choosing which items to fix/upgrade typically requires a little more strategy than some people realize. Fresh paint and new flooring are essential, but if you want to sell your home for more, adding extra incentives may be beneficial. Energy-efficient lighting, a home security system, outdoor motion sensor lights, and renovated landscaping are all examples of higher-end renovations that may result in a greater return for your property.
Tip #5: Don't Overprice Your Home
After months of long hours filled with incredibly hard work, your home is finally ready to be sold. Now comes the challenging task of choosing how to price it. Because you will be intimately acquainted with how much hard work you've put into your property and how far it has come, you may be tempted to price it higher. However, your buyers will have no idea of the home's background - all they'll know is how its price compares to that of comparable properties. Overpricing your home can cause it to sit on the market for a long time. Pricing your home in the same range as comparable properties will probably be more strategic.
In Search Of A House To Flip? Let Me Know!
Flipping houses comes with a certain amount of risk, but if approached correctly, it can be incredibly lucrative. If you are looking for affordable homes at the Lake of the Ozarks that could become profitable investment properties, let me know. In my years working as a real estate agent at the Lake of the Ozarks, I have gained valuable insights into our local market. I would love to help you find affordable, low-cost properties to begin your investment journey. Give me a call at 573-216-8439 to start the process.
Here For All Your Real Estate Needs At Lake Of The Ozarks!
573-365-1555
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