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Flipping houses can be a great way to make money and when done properly, can prove to be incredibly rewarding. However, before flipping a property there a few things to consider to help make sure you get the best profit from your home and avoid potentially expensive mistakes. Take a look at the topics we’ve covered below to help you on your property flipping journey.
Things to Know Before Flipping a House
Do Your Research On The Area
Most people thinks buying a house is way better than building their own house. Before choosing the right property to flip, you need to have an idea of the right area in which you are going to be looking for properties. There are several factors that can affect which area is the right for you.
Some important factors to consider include:
- The average house price in the area and whether this fits your budget
- The distance of the property from where you’re based and whether it’s too far to commute
- What the local buyers in the area are looking for from a property and how that will affect the renovation costs
- How well homes are selling in the area and the average prices
- Whether the area is up and coming in terms of property desirability
Build Contacts And Find Reliable Tradesmen
An essential component of flipping houses successfully is building up your contacts and forming a strong team around you. As we will discuss later, getting involved in your house flip can help you to save money, but there are times when you will need to call in the experts. For example, it’s likely you will need qualified tradesman such as electricians, builders, and plumbers to carry out more complex work.
There are plenty of reliable and hard-working tradesmen out there that will be a huge asset to your house-flipping journey, so be sure to do plenty of research to find the right ones for you. Asking for recommendations from family, friends, or other property developers can help you to find reliable and trustworthy tradesmen.
You can also look online and read reviews from previous customers to find professionals such as painters and decorators near you. Calling in the professionals can help to reduce the time your house flip will take and get it onto the market quicker.
Calculate Costs In Advance
One thing you need to make sure you do before purchasing a house to flip is work out the renovation costs. This will allow you to establish whether or not a property will be profitable or not. It will also give you the opportunity to create a budget plan before you get started.
Creating a budget plan will help to make sure you’re left with a decent profit by the time the work is completed. It’s a good idea to create different sections to your budget plan in a spreadsheet that you can add to as you go along, as this will allow you to keep track of spending in specific areas so you can adjust your spending accordingly.
Make Use Of Property Auctions
In order to find properties that will allow you to make a decent profit, you should consider attending a property auction. These can be done either in person or you can place bids through an online auction. Auctions tend to list properties that are selling far cheaper than properties you may find on the market.
Many of these properties can require extensive renovation work, making them perfect for property developers looking to add value and sell for a higher price or rent out. When buying an auction property, you need to make sure you do plenty of research into the properties you’re interested in, how much they will cost to renovate, and any potentially expensive issues that come with it.
Carrying Out Surveys
An essential before buying a property is to have a survey carried out. A survey will be able to tell you whether there are any serious issues with the property, allowing you to factor this into the costs if you were to buy it. There are different kinds of surveys you can choose to have carried out, and the right one will largely depend on the kind of property and/or land that you’re thinking of buying. Check out what each type of survey offers, so you can find the one that suits your needs and give you all the relevant information you need to make an informed choice.
Pay Close Attention To The Legal Pack
Finally, you need to make sure you pay close attention when reading the legal pack of a property before you choose to buy it. This will give you any important details that can affect flipping a property. For example, whether the property is listed, and whether it comes with planning permission.
It can also include useful information such as the terms and conditions of the auction sale and any structural issues with the property. You can usually request an online version or hard copy of the legal pack to read through before bidding at the auction.
