Anyone who watches any television at all has seen the reality programs dealing with real estate. People who are out there flipping houses for a living or flipping houses for profit make the process look simple and easy. While it is not as simple as it looks on television, nothing ever is, there are a lot of people who, armed with some funding and house remodeling software or a keen eye, are able to make decent money when they flip real estate.
- Never lose sight of your budget. If you are new to the world of house flipping, you may not know a lot about the ARV or “after repair value.” It does not take any fancy house remodeling software to understand what that is, it is how much you will be able to sell the home for after you have done all of your work on the property. You should never spend more than 70% of the ARV on the home. Before you buy a property or begin your renovations, you need to make sure you can do it all for under 70% of the end sale price. There are no exceptions to this rule if you want to make money on the process.
- Learn everything you can about the market. You need to pick a market that you will make your specialty. Every home flipper needs a niche market to work in. You need to know everything about the market. That includes with what is happening with home prices. Are they going up or down? Are there neighborhoods that are up and coming or may be in the future? Even the best house remodeling software cannot tell you that a certain part of town is about to become the “in” part of town. For example, for years, the area east of the Potomac River, in Washington, DC known as Anacostia was considered to be terrible. Now it is hip, trendy and the place to be. Knowing that five years ago made a lot of people a lot of money. Those were experts in that market.
- Know what your buyers want. If you are going to be successful with your house flipping endeavors, your have to sell a product that people need or want. Knowing your market, you know if the people who live in the area are families with children or retired people. Maybe the market has a big university with lots of students and the academic community. When you are using your house remodeling software, you have to always think about what the people in your market are going to want in a home. For example, if you know there are a lot of families with children you need to make sure the homes you renovate have the right number of bathrooms and the right number of bedrooms. Just never lose sight of what the home buyers in the area are going to look for.
- Spread the word about your renovated home. You can do the best job in the world, with or without house remodeling software, but none of it matters if no one sees your home. Get people in. Advertise the changes you made to the home. Draw up a list of all of the changes you made to the home and let everyone know what you did. More and more home buyers are looking for homes that are energy efficient. If you have remodeled a house to use less energy, you need everyone who looks at the house know about it. This is not the time to be modest, this is the time to blow your own horn.
- Be careful with your pricing. If you have done the right research into your market, you should know how much to price your home for. House flipping software cannot tell you what to charge for the home but common sense should. You may be really proud of the work you did but do not let that allow you to set the price too high for the area. As hard as it may be to sell a house for less than you suspect you can get, you need to be smart about this.
Price your house correctly and you will succeed.