Flipping houses and flipping houses successfully are two different things. It’s critical you take the right steps in order to maximize your chances of profiting. Unfortunately, you’ll never be sure of anything in this business. Until you’ve sold the home and received the check, everything is up in the air. But you can make sure you’ve done all you could to maximize each project if you follow the right best practices.
There are procedures which can’t ensure but will definitely increase the chances of doing well. They can be applied from the first purchase to the very end of the process when you find the right buyer for the home you just flipped.
Let’s take a look at 3 most important house flipping best practices
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1. Choose Standard homes
Home flippers without much experience in the niche shouldn’t aim for houses that are too big or have many unique aspects. Instead, aim for what most buyers would consider purchasing in the area. In order to apply this best practice correctly, it’s mandatory to carry out local research. You must find out what people willing to become homeowners are looking for and flip standard houses accordingly.
Look for a non-home that’s smaller than three to four bedrooms, less than 2,000 square feet and a price that you know you can profit after completing the repair. Then, you know you’ll be acquiring an entry-level home with higher chances of sale and profit — plus it’ll be easier to get a fix and flip loan for a lower amount.
2. Hire a professional team
By not hiring people to help in the flip, you might think you are saving thousands of dollars. However, unless you are a real specialist at everything that needs repair, you’d a better lookout for a contractor who can help.
Yes, you’ll be paying for their services, but with a professional team, you are also acquiring more quality you could provide alone. And quality means more value and, therefore, you’ll be able to sell for more. Also, time is an essential asset in the world of house flipping. With more professional people working on the flip, you’ll definitely save a lot and skip some maintenance costs when you take too long to sell. Not to mention the marketing and interest expenses you might incur as the clock ticks.
According to the necessities of the house you bought, you’ll figure out which professionals to hire as your house flipping team.
3. Save money, saving time
As stated before, you should always be aware of how much time you’ll be spending on your project. Taking too long may increase the costs and postpone the date when you’ll finally get the profit in your pockets. It can take anywhere from several weeks to several months to flip a house, but it can sometimes take longer. You’ll have spent by then a few weeks researching the market and all the data you were able to collect on the market and prospective buyers.
Then, you’ll also spend both time and money advertising, unless you have a specific buyer already interested in purchasing it. That’s when the project is concluded, and you are able to cover all the expenses, including a possible loan. In order to avoid extra costs and further interest on your debts, you should rush and conclude your house flip as long as possible. It’s not likely to be precise about how long a house flip takes, but you can at least estimate and follow the plan.
There is no way to have certainty in a speculative business such as house flipping. However, those who venture in that world such know their market and apply the best practices. By doing so, it’s possible to reduce risks and improve the chances of profitability. These three hints above are considered best practices, especially for those who are only beginning in the house flipping market. Apply them, and you won’t be counting on luck alone.