Property flipping is the easiest and most sought after money making tool in real estate market. Property flipping has two sides to it – first the buying and then the selling. To make a profit in property flipping, you should know how to buy at a reasonable price and sell it for a good profit. Real estate guru Jeff Adams believes that investors who miss out on the nuances of the 2 sides of property flipping end up losing money in the process.
Here, he advises you on how to take care of both aspects of property flipping.
Buying the Property
Decide Your Budget
The first step in property flipping is to decide your budget and arrange your finance accordingly. Your budget should include what you are willing to pay for the property plus the investment in renovating it to be able to sell it at a higher price.
Zero in on the Right Properties
When you want to buy at a lower cost, it is best to invest in foreclosed or pre-foreclosed properties. Such properties are sold below current market prices. It therefore, opens greater avenues of profits and returns. Persistently look out for foreclosed as well as pre-foreclosed properties. Once you get the right deal take it forward in the best way. Negotiate with the seller, as he/she will be in a hurry to sell the property before it gets foreclosed.
Inspect the Property
Inspect the property thoroughly before finalizing the deal. You might want to know the ongoing rates such properties are fetching in the area, how the neighborhood is, and whether it has access to amenities close by. Once you are satisfied on all counts, move in quickly and swoop the property.
If you do not have ready cash (always the better option), go ahead and avail the best mortgage from the bank and buy the foreclosed home you’ve zeroed in on.
Selling the Property
Keep Some Budget for Renovation
The other side in property flipping begins once the possession of the property to be flipped is acquired. If you have invested in a foreclosed or pre-foreclosed home, it would need to be worked upon. Your profit potential increases once you get the best renovation done to sell it a price way higher than what you bought it for.
Be Quick
You can also make good money on your deal if you are quick in your after purchase procedure. Buy, renovate, and sell without wasting too much time. Several small deals done quickly can eventually bring you very close to your dream deal.
Consider Roping in a Partner
If you are eyeing a new property for flipping, it is also a good idea to invest with a partner. Sharing profits is any day better than losing all your capital in a sole venture. Even though profits would be divided you will have also constant support and encouragement.
These are the two sides to property flipping. Jeff Adams opines that buying cheap depends on you finding the right deal at the right time with the right kind of ground work and calculation. The other side is to sell at a good profit which is possible if you make an advance assessment of the money involved in renovating the property and other expenditures. Only this will give you a fair idea of the profit the proposed deal will bring about.
Enjoy the benefits of property flipping by fully understanding both its sides deftly.
