Flipping Houses The Sexy Way To Real Estate Riches

Flipping Houses The Sexy Way To Real Estate Riches

By Wilbur Corncob

It seems to​ be everywhere, the​ hype makes you think that flipping houses for​ profit is​ as​ easy as​ flipping a​ pancake! at​ first I couldn't understand all the​ excitement. Maybe I am just old but it​ finally dawned on it. Flipping houses isn't new at​ all. It's just a​ new name for​ an​ old way of​ making a​ lot of​ money in​ real estate with a​ LOT of​ HARD work; fixer uppers.

That's right fixer uppers. Now, that does sound like a​ lot of​ work. Who would want to​ sell you an​ ebook explaining how to​ make a​ lot of​ money in​ real estate that involves a​ lot of​ hard work? It's better to​ call it​ something spiffy and​ new so the​ ebook and​ course profits are increased; without any hard work!

Now comes the​ question.. what exactly is​ wrong with flipping houses or​ buying fixer uppers and​ fixing them up and​ selling them? the​ answer is​ of​ course absolutely nothing and​ it​ might be the​ best way to​ the​ best profits in​ real estate.

You need to​ know what you are getting into though. if​ you are already making mega bucks with fixer uppers, oops, I mean house flipping, you probably aren't searching the​ Internet for​ information. if​ you're looking to​ get started you probably ended up here and​ with a​ half dozen courses and​ ebooks purchased.

Now your at​ the​ difficult part. Actually doing it. if​ you were just investing in​ a​ simple rental property it​ would be easy. Buy the​ property, rent the​ property, possible resell the​ property. When you purchase the​ property you just have to​ decide on its value once, the​ rental price (possibly easy if​ its already rented), and​ determine if​ it​ is​ easily rented for​ your desired price.

For the​ flipper you'll need to​ decide on some prices. Actually "guess" might be a​ better word until you have some considerable experience. First you have to​ decide on the​ price you'll purchase the​ house it, then and​ more importantly you'll have to​ guess what price you'll be able to​ sell it​ at​ once fixed, and​ you'll have to​ guess at​ what the​ repairs will actually cost (and how long they will actually take). Guess wrong on any of​ these 3 prices (or what the​ repairs will actually involve) and​ your easy profits with no work may just be dreams digging a​ hole in​ your wallet.

Chances are you won't have the​ benefit of​ any cash flow from rental income until your fixer upper has been fixed up! if​ you misjudge the​ repairs or​ how long your contractor will take to​ finish the​ project you could be paying the​ mortgage out of​ your pocket.

Of course your always told to​ just go after the​ properties that need minimal work like one coat of​ paint and​ the​ lawn mowed. Good advice. You might ask why the​ person offering the​ property dosen't do that work. There are many possibilities and​ one might be that for​ some other reason the​ property is​ a​ dog.

Now, of​ course I've seen the​ formulas. for​ example you can purchase a​ beat up little house for​ $140,000 or​ us. it​ will cost you another $20,000 to​ have it​ fixed up to​ be the​ spiffiest little house on the​ block (OK, make that $40,000 cause your contractor forget a​ few details). Now the​ more important part of​ the​ formula is​ that this house is​ not ready to​ be sold for​ $349,000 or​ so. That means after a​ month of​ two of​ fighting with your contractor you can sell your $180,000 house for​ $349,000 and​ pocket a​ cool $169,000.

Who wouldn't be first in​ line for​ that? I suspect there are only two problems with this formula. Remember above I talked about guessing. Well, I guess that a​ house that needs $20,000 in​ work to​ be worth $349,000 will be offered on the​ market at​ something like, well, you guessed it​ $349,000 not $150,000.

The second problem is​ how we guessed this house should be worth $349,000 in​ good condition. in​ my neighborhood there are over 500 condos for​ sale. One web page lists 494 of​ them! Some of​ these are brand new and​ some are older buildings (some much older). Now this should present some excellent condo flipping opportunities. a​ little paint, new bathroom or​ kitchen fixtures and​ a​ cheap condo is​ ready for​ a​ millionaire!

The problem with the​ idea of​ flipping condos in​ my neighborhood is​ that a​ new building is​ going up on almost every street corner. Many of​ the​ old condos have asking prices as​ high or​ higher than a​ brand new condo. Now, I buy an​ old beat up one, fix it​ up, and​ when I'm ready to​ sell it​ I have to​ compete again brand new condos!

That is​ a​ sales job I don't want. Every purchaser will ask the​ same question, I can buy a​ new condo for​ the​ same price.. why do I want your old one (fixed up or​ not)?

For now, I think I'll stick to​ flipping hamburgers

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