House flipping is the process of buying a property with the intent to fix it up and sell it for a good profit. This has become a significant industry, popularized in part by the HGTV network. In the United States, 5 to 6 million homes are sold every year. In 2020, 5.9 percent of those were flipped. Yet, with this popularity and its potential rewards, house flipping takes a lot of work and is not without some risks.
8 Steps Toward Successful House Flipping
Follow these 8 steps leading to potential success with house flipping:
Conduct research to help you identify the right market areas to do your flipping. Neighborhoods that are classified as Class B and C neighborhoods typically offer the best opportunities.
Create a solid business plan, a thoroughly well-thought-out budget, and a timeline. This will include the considerations of how much to have (or can get) to invest, how much properties and renovations will cost, how long it will take to do the renovations and sell the property.
Secure the financing that you will need to accomplish the project. Having funds secured should always precede purchasing a property.
Assemble a team of experts to help you. This will include a lender, a real estate agent who can help you find a property, and a general contractor to do the renovation work.
Find a house to flip. Find a property below market value with the potential to deliver a good profit margin. Make sure it is a good investment without structural or other serious issues.
Buy the property.
Renovate the property, making wise choices on what to fix and what to spend.
Sell the property.
House Flipping Mistakes to Avoid
Successful house flipping results in a profit, so avoid the mistakes of miscalculating repair costs, spending too much on the property, and taking on too big of a project.
Seek Expert Financing Assistance
Contact Lode Capital for financing made easy. We offer customized financing options that are critical to your success.