Top 5 Tips When Considering a “Flip”
So, you’re thinking of buying a home in need of some TLC, increasing its value by fixing, adding, and upgrading certain features, then selling it for a profit? Welcome to the Flip zone!
In recent years, thousands of novice folks, have leveraged some fortunate (and often times unfortunate) times in the market to make hefty profits. In turn, they have made a nice living by flipping homes across the U.S.
But like every business venture, there are inherent risks to consider when contemplating your first flip. At DiversyFund, we receive crowdfunding requests from countless investors. Many flip an average of 5-10 homes per year. We pass on over 99.9% of those request. When accepted, we work with them throughout the process of sourcing, bidding, purchasing, and renovations. Often becoming the lead developer or lead project manager. Over the years, we’ve heard some of the major “DOs & DON’Ts” from our top investors. Although we could feature a never-ending list of best practices, we’d like to start by covering the basics.
Our Top 5 Tips to Flip a House
- Study the local market, as well as the surrounding areas in which you’re looking to buy your first investment home. The real estate market varies from region to region, and from city to neighborhood. Keep in mind that the market is cyclical in nature. Make sure you think in short and long-term, as well as align that with your immediate and future goals.
- As excited and motivated as you may be to get started, we recommend starting off on this path with a smaller, more affordable project. Chances are that mistakes will be made, deadlines may not be met, and that it may very well take longer to sell off your project. Lessen the stress by not biting off more than you can chew- at least not on the first feast!
- Hire Pros! Unless you’re truly the “Jack of All Trades” (and hopefully a licensed one), you should have a team of professionals ready to tackle everything from structural elements, to electrical, plumbing, and paint. Research and ask for referrals.
- Make sure all your permits are in order. One of the biggest frustrations for first-time flippers is the realization (usually an afterthought) of the headaches associated with not having, or waiting on the appropriate permits to move forward with your planned renovation(s).
- Get the numbers right… or as close as possible. We’re talking about all the numbers you need to consider when bidding on the home, the contracts/contractors, permits, materials, and of course the price at which the home will be listed once complete.
Choosing to Invest
If you would still like to pursue the “Flip Zone” then, by all means, go for them. But, If you simply want to Invest in pre-vetted development opportunities with higher returns- we’re an Expert. Our complete online crowdfunding real estate investment platform offers such passive investors with high quality, pre-vetted projects for investing. Through Crowdfunding platform and our Expert team with their skin in the game, you can lower the risk and increase your profits. Check out our current exclusive crowdfunding investment opportunities and Invest Now.