What Goes Into Flipping a Home?
All investment properties are not created equally, and if you leave it to HGTV, flipping a house can look like a relatively easy task. But there are some things you want to steer clear of if you aren’t interested in doing a total tear-down. Here are some tips for a new investor from all of us at The Investor Hub.
When looking for a property to flip with a relatively short turn around, stay away from properties with questionable or bad foundations. The price of the property might seem great, but repairing the foundation of a home can be a ghastly expense. Even if you can repair it without having to start from scratch, it is as costly as it is time-consuming, taking much longer to get the house flipped and back on the market than one would hope.
Unless you are planning on hammering every nail and installing every window all on your lonesome, you will need to look into likely more than one contractor. Keep in mind you will need to coordinate the work of contractors so that they are not conflicting in each other’s space and that you are sticking tight to the timeframe in which you want to finish.
Location is everything. If you are looking for a property to fix and flip, no matter the price, evaluate the location. Is the property on a busy street, what is the crime like in the neighborhood and what is the proximity to desirable amenities? It is in your best interest to skip the low-priced home in a less than desirable area and invest in the worst home, on the best block.
Look at the shape of the house as well as the floor plan, if the property is “unique” in shape, this may not be the best investment property. Odd shaped houses tend to stay on the market for a longer time. The same thing goes for the floor plan, buyers are looking for an open space, furniture is what determines a space not necessarily walls. If it becomes clear that you will have to demolish multiple walls, it might not be as cost-effective or produce the return that you have invested.
If you are looking for a flip that is to the point and cost-effective, it’s essential to know when to say no, to what may seem to be a killer deal.