Photo source: Pixabay
The fix-and-flip property market has the potential to be incredibly lucrative, if you get your approach right, that is. What it’s important to be mindful of is the fact that it is a process that can be both risky and rewarding – it’s not always as simple as sourcing a cheap property, updating it, and then flipping it for a profit.
In order to make a successful property flip, there’s a lot that needs to be thought about and taken into account. Believe it or not, once you have the knowledge that you need to successfully flip a property and start building a potentially prosperous business, it becomes far easier than you might think.
Wondering what it takes to get your house flipping business off to a good start? Below is a guide to lots of useful and actionable tips that should help to make building a successful flipping business more achievable.
Be smart about what you’re purchasing
The most important thing that you can do when it comes to building a successful property flipping business is to be mindful about the kinds of properties – and the issues that they might have – that you’re purchasing. Don’t just opt for the first cheap property that comes along, take the time to look at each property and its potential strategically.
When selecting properties to purchase, it’s a smart step to avoid homes with damaged mechanical issues. Instead, for ease, opt for properties that tend to have mainly cosmetic issues that can be easily (and quickly) modified and fixed. These kinds of properties will come with larger profit margins as they will cost a lot less to repair and upgrade.
Source the right contacts
Like in all areas of business, it’s important to build a list of reliable contacts who you can work with on a regular basis, from real estate agents to purchase properties from (and potentially sell them via) to contractors who can help to deal with any issues that you’re not qualified to fix yourself.
Having plenty of contacts on hand is important for all stages of property flipping, from the process of sourcing potential new properties to making a good profit on flipped properties. A great way to source good local contacts is to attend local networking events, where you will have the opportunity to meet plenty of useful people and businesses.
Plan for various exit strategies
Don’t assume that you know exactly how each property flip will end, because the fact is that isn’t the case. That’s why it’s a good idea to plan for a range of different exit strategies so that you know what your options are when it comes to flipping each property.
Whether you’ve accidentally spent more than you budgeted on the flip, the economy changes so the property is worth less, or the real estate market has shifted, this may change the value of the property, and thus your approach for flipping it. So having multiple exit options available is a smart move to make.
There you have it, a guide to how to get your property flipping business off the ground.
