Be Careful, be very careful ….. Not all home flipping scenarios are working out, some have turned into nightmares. Just a few words about what I have been seeing, and some of what you need to look for, to stay ahead.
Values – What is the real value of the property, use conservative numbers, very conservative.
Repair Costs – Make sure you fully understand all costs, and all repairs needed, wanted, and must have repairs. Too many times this dollar amount is under-estimated, do not under-estimate.
Time – How long will it all take – The purchase will take, repairs will take, marketing & resale will take, closing will take, etc. Remember that old saying ” Time is Money “ it has never had more meaning than it will during this process.
Money – What is the costs of the money you will be using, to get everything done, completed from start to finish. Make absolutely sure you know all about the money !!! Where is it coming from, and how much will it costs is a big key to a successful flip. Will it all be there when you need it, and is there extra. Yes, extra money available …. Make sure you have all the money you need, plus extra, lots of easy to get extra.
Marketing & Selling – What are all the costs going to be, and again how long will it take. Do your best to get an accurate opinion about this final step. Again, what is the real value and look to reduce that price. Who will be marketing the property, and what is the time frame going to be. How long to market the property, get it sold, and close escrow, providing nothing goes wrong. Make sure you allow for things to go wrong, and that means more time and money.
NOW YOU ARE READY TO SIT DOWN, GATHER YOU TEAM TOGETHER, AND DO THE MATH….
What ever you come up with, give it all a buffer… Yes, extra time, money, repair costs, and of course value.
This is just a brief look at flipping a house, for profit …. Good Luck