The Great Recession inadvertently ushered in a new way to make money. House flipping is becoming more and more popular every day. You purchase a cheap piece of property, renovate it, and then sell it for a profit. Seems easy enough, but it does have some catches, so here are seven ways to maximize your profit from your next fixer upper.
- Be Open Minded
The first way to maximize your profit is to test a less desirable neighborhood. Money isn’t only to be made in the nicer part of town. You’d be surprise how many people are looking for spruced-up lesser valued properties.
- Look at the Auctions
When looking for house flipping prospects, check out your local foreclosure auctions and short sale listings. These properties can be bought oftentimes for much less than their actual value.
- Research the Property
Don’t just attend an auction and snatch up the first land on the block. Check out each piece thoroughly prior to buying to make certain you can flip it for a gain.
- Consult the Experts
While checking out the property, it’s wise to discuss the renovations with professional contractors and the resale value with local real estate agents. These people know the market, and they’ll be able to tell you if the home is a good investment.
- Consult the Demographic
Another thing to consider is what people want. When seeking real estate for house flipping, you want to buy homes that can be renovated to the market’s current demand. For example, don’t purchase a home in need of bedroom renovation when kitchens and bathrooms are all the rage.
- Find the Best Financing
Once you’ve found a great house to turn, figure out the best way to finance it. There is no set rule on funding your investment. It all depends on your financial picture and the profit you hope the property will return.
- Don’t Price Yourself Out of the Market
Finally, make certain to price your renovated property in such a way that people will buy it. You won’t earn a profit if you price the flipped home too high. This is why it’s so important to assess the resale value with an expert prior to purchasing the home in the first place.
House flipping is a great way to earn some investment cash, not to mention it’s fun for most people. To get into this lucrative money-making venture, do your homework thoroughly, and employ several industry tips designed to ensure that you earn a profit on your next fixer upper.