There are a lot of shows on TV that depict the process of flipping a house—and they make it look incredibly easy and lucrative. While it certainly can be, it’s not as simple as the shows make it look. Flipping a home requires education, experience and hard work.
There are also risks involved with flipping houses. Thus, if this is something you are really interested in doing, you have to have courage and the right information. Here are some tips on the best way to flip a home in Northern Colorado.
Buy at the Right Price
Before buying a house to flip, you need to have a buying budget in mind—and you need to stick to it. Your goal is to make a profit through this process, and if you spend more than you have purchasing the house, you might find yourself in debt instead of making money.
It’s also a good idea to know the market before you buy. You don’t want to pay more for a home than necessary—especially if you then have to invest money to make improvements. Talking to other investors or real estate agents in the area can help you decide if the house you are looking to buy is a good deal or if you should wait for something else to come along.
Make Sure You Have Funding Available Immediately
The housing market can change in an instant, and no matter what type of house you are buying and when, you may find that you have competition. Most sellers are looking to get out of their home as quickly as possible, so if you have funding that is available immediately, you may win over other buyers.
Most people who flip houses have cash on hand to buy property. Thus, you should consider moving beyond the pre-approval stage to having the money in your account to buy right now.
Keep a Refurbishment Budget in Mind and Stick to it
Not only do you need to create a budget when it comes to buying a home, but you also need to create a budget when it comes to repairs and improvements. It doesn’t take much for house repairs to get out of hand, and you don’t want to put more into the house than you’ll get out of it.
It’s a good idea to account for unexpected repairs in your refurbishment budget as well. This might include making repairs in the event of water damage, electric wiring that isn’t up to code, plumbing problems, or any other issues that might arise.
Creating a refurbishing budget can be incredibly challenging, mainly because you never know what you are going to find once you get into the house. You also need to consider that the longer you hold onto the property, the more you’ll have to pay in insurance, taxes and utilities, among other costs. Thus, the sooner you can improve the home and sell it, the more money you’ll be able to make.
If you’re a first-time house flipper, you might be tempted to add features to the property that you would want in a home. These may be appealing to you, but they may not be appealing to all buyers.
It’s in your best interest not to pay for expensive window treatments, tiles or finishes. Focus on making economical improvements and leave the big changes to the next buyer. That way, they can customize the house to fit their wants and needs.
With that being said, you should add a few touches to the home to make it more appealing when you resell. Some of these might include upgrading countertops or finishes in the kitchen or bathroom and making sure there is fresh paint throughout the entire house.
Price it Right
One of the biggest reasons many houses take a long time to sell is because they are priced incorrectly. When it comes to flipping houses, you certainly want to make a profit on the endeavor, but don’t price the house so high that no one is interested in buying.
The easiest way to determine if you’ve priced your house too high or too low is to look at the activity. If no one is looking at the home, you’ve probably priced it too high. If you’ve received a lot of offers in a short amount of time, it’s probably priced too low.
Knowing the right price for your flipped home will depend on several factors, including the marketing and how much you’ve invested. It may take some time and effort to find the right price, but once you do, you should be able to sell the property quickly and make a profit.
Sell at the Right Time
If you’re looking to get the most out of your flipped property, selling it at the right time is imperative. Traditionally, spring is the best time to sell a home, so you might consider putting it on the market as the weather gets warmer—assuming it’s ready to for buyers to look at.
When you put your flipped home up for sale will depend on what the market is doing and when you are finished with repairs. Spring may be the busiest time for real estate, but people are looking for houses throughout the entire year.
If you have something of value to offer potential buyers, and the house is priced just right, you may be able to sell it whenever. As mentioned, the longer you hold onto the house, the more your expenses increase. Thus, it’s in your best interest to sell it as quickly as possible when you are done making improvements.
Flipping a home in Northern Colorado can be incredibly lucrative, but you have to know what you’re doing. The process takes time and effort, as well as some knowledge of the current real estate market. It also takes money, so develop a budget for buying and refurbishing to ensure you get the most out of the house flipping endeavor.