3 House Flipping Secrets
If you’ve ever seen a house renovation show, you know the hosts make it look so easy! They quickly find a house, slap a coat of paint on it, and resell it for much higher than they bought it for. But, we all know that’s just television magic; they don’t show you the house flipping secrets they take into account each episode.
Know the market
How do you know if it’s better to flip, rent, or buy and hold? Depending on the market and area, you may find that a rental will yield longer-term income than a house flip - or vice versa.
In most major cities like Chicago and Dallas, families in apartments might be looking to expand into a rental house, making the profit margin for a flip less profitable. However, in some areas of the same city, you might get far over asking price because the demand for houses is so high in that certain area or district.
Looking at the demographics of the areas you’re looking to break into will help to show you how many people are moving in and out, renting, buying, and selling. This lets you know how many houses are available, and a general idea of how many people are looking for rentals.
Find a good flip
Looking at a home as a homebuyer and as a flipper are two different viewpoints. Flippers look at homes that have strong foundations, are structurally sound, and are in a great location. If a home needs major rework on plumbing, HVAC, electrical, roof rework, or other large issues, a flipper might pass because those repairs are costly and time consuming to complete.
On any house you flip, you’ll want it to be located in a good area, but how do you know if it is or isn’t? Generally, flippers will look for areas that have low crime rates, in a great neighborhood, and are close to amenities - short commutes to restaurants, gyms, and stores. Neighborhoods that have great curb appeal with good schools in the area could also be a major selling point for families looking to rent.
Know the house-selling trends
When selling a house, keeping on-trend for what buyers are looking for is the last of the house flipping secrets. Walking the fine line of trying to stay trendy, but timeless can sometimes be difficult if you don’t have an eye for design. Using cool tones, such as grays, with clean finishes will appeal to many homebuyers. You also want the house to be memorable. When homebuyers are looking to buy, they don’t settle on the first house they see. Budgeting in showstoppers like vanities or kitchen islands will help the home stand out. However, you’ll want to keep these things in moderation and not go overboard - less is more. Budget with the knowledge that you’re increasing the marketability of the home, but that you might not get all of your money back if you put too much into it.
With our deep ties in local markets, Renovo can connect you with experts to help you obtain financing for flipping a house. Contact us today.