If you are into buying houses, fixing them up and reselling them (called ‘flipping’), you may have found it difficult at times to find the kind of home you need for this kind of project. Here are some tips on how to find the right kind of house to flip:
- Work with a real estate agent. A good real estate agent can help you find houses that are a good fit for your flipping criteria, and they can also negotiate on your behalf if you need that kind of help.
- Talk to wholesalers. Wholesalers are real estate investors who find houses that are undervalued, put them under contract, and then assign the contract to another buyer, usually for a fee. Wholesalers can be a great source of deals on houses to flip.
- Look for auctions. Foreclosure auctions and estate auctions are two places where you can find houses for sale at below-market prices. However, it’s important to do your research before bidding on a property at auction, as you may not have time to inspect the property before you make an offer.
- Join a real estate investment group. Real estate investment groups (REIGs) are organizations of people who are interested in investing in real estate. REIGs can be a great source of networking and education, and they often have lists of houses for sale that are not listed on the MLS.
- Search the MLS. The multiple listing service (MLS) is a database of all the homes that are for sale in a given area. You can search the MLS yourself, or you can have your real estate agent search for you.
- Network with other real estate investors. Real estate investors are a great source of information and deals on houses to flip. Attend real estate investment meetings and events, and connect with other investors online.
- Drive around and look for neighborhoods that are on the rise. Look for houses that are in need of repairs, but that have good bones.
- Look for FSBO listings. FSBO listings are houses that are for sale by owner. These listings can often be found on websites like Craigslist and Facebook Marketplace.
- Look for probate properties. Probate properties are houses that are being sold to settle an estate. These properties can often be purchased at below-market prices.
If you are an experienced house flipper, you know that once you’ve found a few potential houses to flip, you need to do your research to determine if they are good investments. This includes looking at the following factors:
- The purchase price. The purchase price is the most important factor to consider when flipping a house, as it will determine your profit margin. You need to make sure that you can purchase the house for a low enough price that you can still make a profit after factoring in the cost of renovations and other expenses.
- The cost of renovations. The cost of renovations is another important factor to consider. You need to get estimates from contractors to get an accurate idea of how much it will cost to fix up the house.
- The after-repair value (ARV). The ARV is the estimated value of the house after it has been renovated. You can use online tools or get estimates from real estate agents to determine the ARV.
- The neighborhood. The neighborhood where the house is located is also important to consider. You want to flip houses in neighborhoods that are desirable to buyers and that are on the rise.
Once you have considered all of these factors, you can make a decision about whether or not to purchase a particular house to remodel and flip.
Flipping houses can be a great way to make money, but it’s important to do your research and find houses that are good investments. By following the tips above, you can increase your chances of success.