Cheap Real Estate For Flipping: What To Look For
Posted on: 15 December 2016
Flipping homes for profit is something a lot of people do to make quick money. This financial gamble is a simple one: you buy a fixer upper or very cheap home, make a few upgrades, then turn around and put the home up for sale for much more than you purchased it for. It's an excellent way to quickly make a large amount of money if you play your cards right and buy the best houses for flipping. In fact, gross margins average just under or around $30,000 per flip. Here are things you should look for when buying cheaper real estate for this purpose.
Condition
The most expensive upgrades or fixes in any home are the roof, kitchen, and bathroom. The condition of any home is key to whether it will make an excellent flip or not. For example, replacing a roof can cost upwards of $2,000 which can eat up most of your remodeling budget. If you buy an older home that needs to be remodeled or is a real fixer upper, keep in mind that large repairs will take up the most money. It may be hard to flip a home with a brand new roof if the rest of the property appears neglected because you were unable to fit all the upgrades into your budget.
Location
A beautiful home in a questionable location can hurt its appeal, even if you were able to make the whole property sparkle and shine. A real estate agent can help you find fixer uppers in areas that potential homeowners will be looking for homes: near schools or local businesses, popular subdivisions, booming towns, etc. You want to use caution when buying a home to flip out in the country unless it comes with impressive acreage.
Extras
Always take more than just the house into consideration when buying a flipper. Try to see the home through the eyes of the new homeowner: how's the view? Is the lot size large enough for a garden or sandbox? Are the neighbors quiet? How close is the home to the nearest freeway or mall? Sometimes the home itself is easy to flip but the perks it's lacking can keep it on the market a while.
If you see dollar signs every time you see a run down home for sale, then flipping may be something you can excel at. If you play your cards right and purchase the perfect flipper you can make a decent amount of cash for your investment.
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