When it comes to making money in the affairs of flipping houses and other real estate investments you will find all sorts of do’s and don’ts along the way. The truth of the matter is that these are extremely useful whether this is your first house flip or you have been flipping houses for years. In fact you might just find that you can learn something new on occasion by reading lists such as this even if you’ve been flipping houses for years and have many successful flips under your belt.
1) Don’t forget to check out the neighborhood prior to purchasing. You will want to make sure that the property you are considering is a good fit for the neighborhood. You should also take the time to make sure that the plan you have in mind for the property will match well with the other neighborhood residents in order to guarantee a quicker sale.
2) Don’t blow your budget without just cause. Your budget is what you used to determine whether or not the house would be a profitable venture. If you blow your budget and cannot recover the extra money you’ve spent in the selling price on the house you will have seriously cut into your profits if not eliminated them all together. The goal in property flipping is to get in and out quickly and spend as little money as possible in order to make as much money as possible.
3. Don’t neglect to set goals for yourself, and to accomplish them daily. In real estate investing, when you miss a deadline, it can take days, weeks, and sometimes even months to reschedule meetings, closing times, and contractors. Missing your goals and deadlines can extend the time it takes to flip the property, cutting greatly into your profits. Every extra day without completing your flip is money lost.
4. Don’t focus only on the interior, remember to increase the exterior curb appeal. If you do not make the house attractive from the outside, it will be difficult to get potential buyers to even stop at the property and walk inside to see the great renovations you have completed. Curb appeal increases both the value and the marketability of any home. You need to have the complete package, with a nice looking interior, and a clean, well finished exterior to attract buyers, and close deals quickly.
5. Don’t spend money foolishly on items which are not needed. You need to evaluate surrounding homes, and what is expected for this neighborhood. Adding an island in the kitchen, new cabinets, and granite counter tops would look great, but in most neighborhoods, are too much and do not add value.
If you want to get the most for your money avoid costly expenses that aren’t exactly necessary for the successful completion of the flip. Resurface bathroom fixtures rather than replacing them if possible and use new cabinet doors or hardware rather than adding new cabinets all together to cut down on expenses. In other words, salvage what you can, fix what needs to be fixed, and add a few cosmetic touches before moving on.
With the rapidly changing real estate market, you need to work quickly, spend your money wisely, and get the property turned over fast. Avoiding unnecessary costs and delays will help you make the highest profits possible, and get moved on to the next deal. As you become more experienced in flipping homes and real estate investing, you may choose to take higher risks, but for now, keep the money in your pocket, and work smart.
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