Moving into the house flipping market can be a very prosperous endeavor, assuming that you do it right. There are a lot of risks involved and a large part of attaining success by flipping a house comes down to mitigating those risks and ensuring that you are prepared for every eventuality.
This means that you will need to ensure that you have a
proper plan in place, that you have purchased the right property, and that you
have the budget available to cover all of the work that needs to be done and
any issues that end up arising throughout the job. It can be quite intimidating
work for a beginner so here are a few tips to get you on your way.
One of the most difficult parts about flipping houses is
learning the ropes when you first start. Because it's something new that you
have little experience doing, it can be intimidating. What follows are three of
the most important tips for beginners to learn when they start with the goal of
flipping houses to make money.
1) Know *Exactly* How Much You Can Sell The House for After
It's Fixed Up
This sounds like common sense, but many beginners make the
mistake of just guessing how much they're going to be able to sell the house
for after they fix it up. Knowing the selling price ahead of time is the surest
way to guarantee that you'll make money by flipping the house. On the other
hand, misjudging how much you can sell the house for after the fix-up is the quickest
way to lose a ton of money. Often people are too optimistic about the selling
price and don't factor in all the variables that determine how much a house
will sell for.
2) Know *Exactly* How Much it's Going to Cost to Fix Up the
House
Probably the biggest mistake people make when they flip a
house is underestimating how much it's going to cost to get the house fixed up
to sell it. It is vitally important to be as thorough as possible when looking
into the cost of the fix-up. Sometimes unexpected expenses can make the
difference between losing money and making money on a house flip. The worst
part is when the cost of the fix-up is so much that it causes the house flipper
to ask too much for the house. This will not only cost money but will keep the
house on the market much longer than desired.
3) Don't Be Afraid to Make Low Ball Offers
Beginners in real estate and house flipping sometimes are easily intimidated and are more concerned with not upsetting the real estate agents and the sellers. Remember, you're in the house flipping business to make money, not make friends with the sellers. If you allow yourself to be intimidated by the sellers, or by angry agents who get upset with low offers, you'll make money much slower than if you have the guts to make low offers.
