Most of the reality shows related to buying a fixer-upper house and selling it for a profit, make it seem easy, but is it really? Most people think they know what all is involved, but they don’t. Its unbelievable how easy it is to get into trouble if you don’t know what to look for in finding the right house to buy and knowing how much money it will take to make it marketable so you can find the right buyer and unload it quickly. Can the process really be that easy? Let’s take a closer look.
The first step is analysing your finances to see if you can afford to take on your new monthly mortgage payment and still have the funds remodel it. You should have an idea as to how much your total budget is going to be and factor in closing costs and other related issues that my pop up such as; inaccurate contractor estimates, the time it will take to complete the project, and additional money required for mistakes and other losses, as well.
Once you’ve got an iron-clad budget, the next step is to find a home that you think is marketable. Most people go into these projects with a property already in mind, but for some, searching for a the right house that is within their budget and, at the same time, will be sellable can be extremely difficult. There are many people out there looking to fixer-upper houses that they can flip, so finding the right one can be difficult.
Once you’ve picked your property, you have to go through the buying process. Expect delays, especially if it is a short sale, and make sure you have the property appraised correctly. Most banks will send out their own appraisers to determine the current value. However, due to the current housing crisis, an independent appraiser is a necessity. Also, be aware that closing costs can fluctuate dramatically.
Once the house is all yours. Now what? The best thing to do is to bring in an expert to help you see everything that needs to be done. From electrical to plumbing to interior design, flipping a house the right way is a huge job, and you have to be prepared to spend the money.
Once renovations have started, be prepared to dedicate as much time as needed to the project. You don’t want someone else making decisions just because you were not there. The repairs that you can do yourself will save you money, but don’t be afraid to call in an expert for the big jobs.
Once the property looks like it should, have it reappraised, don’t be afraid to embrace non-traditional methods of selling it, like the Internet or out-of-town newspapers. If after a few weeks you don’t find a buyer, find a realtor you can work with to list it for you. You need as many eyes on your newly renovated house so you can unload it as quickly as possible and stop making payments on it. The longer the property sits there, the less successful your house flip will be, so be creative.
House-flipping has become one of the most fashionable ways to make money for hard working people. But be prepared to go into your investment with your eyes, and your wallet, wide open.
No comments:
Post a Comment