Flipping a house refers to the process of buying a home, quickly and inexpensively renovating it, and then reselling it at a profit. In the right market conditions, flippers can net hundreds of thousands of dollars in pure profit, and have fun changing a ho-hum house into a treasure.
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The most important thing when flipping houses is to buy wisely. An ideal home to flip is one in a developing neighborhood with a few unsightly but inexpensive cosmetic refurbishments to be made. The house may have sat on the market for a long time, untouched because of its cosmetic flaws. Its price may have been drastically reduced by the time you come around to buy it.
Flippers purchase the house and then attempt to renovate it as quickly as possible. Speed is vital, since the longer the house remains in the flipper’s ownership, the more costs the flipper will have to pay in mortgage and insurance. Those who specialize in flipping houses often employ a dedicated, hand-picked crew who will work around the clock to get the house done.
Another vital aspect of successfully flipping a house is putting some time and thought into what features of the house will be renovated. Of course you will primarily want to fix any especially unsightly features in the house, but concentrate most of your capital into bathrooms and kitchens. Both of these rooms are of particular scrutiny to homebuyers.
Remodeling a kitchen is an excellent way to improve your financial gain on a real estate resale. The addition of expensive looking counter tops, cabinetry and new appliances improves resale profits. By replacing and upgrading bathroom fixtures as well, you can get the most out of your investment.
When flipping houses you should strive to avoid any remodeling or renovation that involves removal or moving of walls, as this comes with high expense and little net gain. It is possible, though, to remove a non-weight bearing wall without much expense if you are hoping to open some space in an area. It is also wise to stay away from extensive renovation of rooms or areas such as non-master bedrooms, hallways, or family rooms, since these areas typically generate no extra profit.
Part of the success in flipping houses is in the presentation to potential purchasers. To maximize profits, sell the renovations you’ve done in the best possible light. Examples would include using “staging” when you show homes with leased premium furnishings and decor to add appeal and including in your make over what is most popular and desired.
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