Flipping Real Estate – Not For The Newbies

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There are so many books, TV shows, free seminars and infomercials about how to make a fortune by flipping real estate that if you haven’t seen these ads, you’re probably in a coma. Sure, flipping real estate can indeed result in untold riches – if done properly. It can also result in bankruptcy and total long term financial ruin that’s hard to recover from.

Everyone and their brother has tried their hand at flipping it seems. Unfortunately, it’s a tough, non-forgiving business fraught with problems. If flippers aren’t familiar with the construction industry or the real estate industry, the “flip” could be the worst decision of your life.

For anyone who insists he still wants to give it a try, this is actually the perfect time to try. Don’t fool yourself, though. You need money. And you can’t expect to get it all from a bank. Lenders aren’t too keen on providing mortgages any longer for these deals because so many have gone bad in the past, even when the economy was thriving. Why? Because people who don’t know what they’re doing take too long to do the rehab and they find that the monthly mortgage payments owed every month on the property are too much to handle.

If you’re determined, first you need to find a house that needs repair, that is being sold much lower than market value, and a house that has repairs that either you can do yourself, or get done at a reasonable cost. (Is your brother a plumber? Can your father put down tile?)

A good deal is to find a home that needs work. Don’t buy a good home thinking you’re going to just redecorate it and sell it for a profit. That’s not the purpose of a flip, and that’s not how you make money.

You buy low, fix what needs to be done – preferably yourself, match the updates to the neighborhood (don’t add cherry hardwood floors or Italian marble in the bathrooms unless that is the norm for the homes in the neighborhood), and dump it before your first mortgage payment comes due.

There are some areas now that flipping is quite possible; other areas won’t have much to offer. Buying a home that needs some serious work for $60,000 is a good deal if you add $30,000 in renovations and sell for $145,000. That’s quite doable in almost any neighborhood. On the other hand, buying a home for $750,000, adding $200,000 in improvements and trying to sell it… That’s a crisis just waiting to happen.

Are you targeting profitable pre-foreclosure deals for investing business? You can get all these crucial answers by going here Flipping Real Estate.

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Topics: Real Estate | Comments Off

Tags: flipping houses, flipping properties, Flipping Real-Estate, Real Estate

Article Citation
MLA Style Citation:
Turner, J. P. "Flipping Real Estate – Not For The Newbies." Flipping Real Estate – Not For The Newbies. 18 Dec. 2009. uberarticles.com. 9 Feb 2012 <http://uberarticles.com/real-estate/flipping-real-estate-not-for-the-newbies/>.

APA Style Citation:
Turner, J (2009, December 18). Flipping Real Estate – Not For The Newbies. Retrieved February 9, 2012, from http://uberarticles.com/real-estate/flipping-real-estate-not-for-the-newbies/

Chicago Style Citation:
Turner, J. P. "Flipping Real Estate – Not For The Newbies" uberarticles.com. http://uberarticles.com/real-estate/flipping-real-estate-not-for-the-newbies/

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