House flipping has reached a new high than it has ever been in the past decade. If you are in the idea of flipping homes, it is important that you understand the crucial elements that contribute to a successful flipping of your home. For example, research by Rightmove indicates that many purchasers prefer to purchase a remodeled home.
Also, keep in mind that there are other costs to buying a house, such as stamp duty and other expenses, such as the conveyancing solicitor fees. To be always ready and prepared in your property journey in Sittingbourne, seek an expert such as Robinson Jackson.
House flipping is done for profit, and it is usually done by purchasing the property, renovating it, and then selling it for a profit within a year. Property experts opine that house flipping in different parts of the UK can get a return on investment of up to 20%. To know more on how to increase your ROI on house flipping, check here.
1. Profit based house flipping
While house flipping, an investor buys a property for less than its market value, renovates it, and then sells it for a profit. An increasing number of people are now interested in house flipping though it has been popular for a long time now.
To gain good profits, it is not enough for the potential to just deep clean, paint and build new cabinets. They will have to put so much more effort by keeping the buyer’s preferences in mind.
When it comes to house flipping, BRR is the most popular term, and it means buying, renovating, and refinancing. Hence you must choose the home you plan to invest in wisely to minimize the amount of money you will spend to refurbish it. Choose homes that are priced less and would require small sums of money for renovation. You can also opt for a bridging loan instead of a full mortgage. It is a type of short term credit that you can pay off once you sell the property.
3. Always keep buyer preferences in mind
It is important to make your home appealing to potential buyers. Hence do your homework to understand the needs and wants of homebuyers and work on the renovation accordingly. This not only saves a huge stash of cash but also impresses potential buyers who are looking for highly functional and practical homes. If you are looking to sell the property to a family, then make alterations that will include a nursery. If you are looking to sell it to a professional, consider furnishing the extra room in the property that can be converted to the home office. You can also consider looking for properties with off-street parking and a large garden which can be a major attraction for families.
Let the first impression be the best. Do not leave room for prospective buyers to see the scope for improvement. Even if there is slight chipping of paint, repaint it immediately. Check out all the recent interior trends and make the home look upgraded and modern.
The ultimate goal of this investment is to be able to sell it at a higher price in the shortest time possible. Promotions play a major role in helping you sell your property quicker. You can also seek the help of professional estate agents who will be able to guide you well in helping you put the property on the market. Another essential tip to make the promotions more appealing is to hire a professional photographer. Great pictures give an impression to the buyers, and their decision will be almost half made.
6. Do your homework
When you decide to do house flipping, you must do complete research on all factors, such as the location and size of the property. The success of house flipping lies in finding the best property in a prominent location at the lowest price possible. Some of the important questions to ponder upon are listed below.
Is the location of the property sought after by buyers?
How good are the transportation and education facilities?
Is there a store close by?
Are there possibilities of future developments in the area that will positively impact the house price?
Check for planning issues that can impact house prices. Choosing a suitable contractor is also very important. Right contractors can help you complete the renovation work you have planned well within your budget and complete it on schedule.
Bonus Tip: How to Find a Good house for Flipping
As mentioned, BRR is one of the ways to reach your goal successfully. However, if you want things to go into the right direction, then you need to find the appropriate house for flipping. At first glance, this may seem like an easy task. However, you will have to put into consideration a wide range of factors to find something you are looking for.
It is crucial that you make the right steps to reach your goal. That is the reason why we would like to highlight the crucial steps you need to make to find a good house for flipping. Let’s find them out together!
1. For Starters – Consider the Location Important
You need to understand that location matters a lot. Let’s use a couple of examples to make things clear. If you want to buy a house for flipping in California, then you need to know that properties there are quite expensive. You will not manage to earn a lot of money (maybe nothing) even if you renovate the house.
On the other hand, there are other locations where you can find relatively cheap houses. Investing in them is going to ensure you a better profit. You can, for example, check the states such as New York, Ohio, or Virginia. Buying a property there and investing in its renovation will certainly ensure you a profit.
2. Get Familiar with Average Prices
Well, this is a must-do thing if you truly want to earn money thanks to house flipping. If you know the average price on the market, you will know how much money you will have to invest and how much money you can potential earn. Despite that, this piece of information will ensure that you do not spend a lot. If you see that a property costs more than usual, then you need to figure out how much you can raise the price after renovation.
3. Check Out the Neighborhood
Keep in mind that different factors can influence the selling price. Let’s say that you found a cheap house in some neighborhood. However, after a short research, you realized that a neighborhood is problematic for some reason. In that case, will you manage to find a buyer who’s willing to invest more than you did?
On the other hand, you need to explore whether something new is going to happen in a neighborhood that could raise the price of your property. Let’s say that a new college will start working there. That automatically means new people would want to live there which will allow you to sell the property for a better price. These details matter a lot!
4. Use the Online World to Explore
If property flipping is the way you want to earn money, then you don’t even understand how lucky you are. You are living in the 21st century – the era of technology. All the useful information that you can potentially gain are available online. Because of that, you should take the advantage of that opportunity to explore all the options available to you.
For starters, you can find out more about the offers that you can grab. Despite that, different tools will help you calculate the ROI as well as all the costs you will have to cover. It is always good to have that type of information available.