Thanks to the magic of television, flipping houses might seem like a quick and easy way to make a lot of money. But just like anything else in life, if you want to do it right and make a profit, there’s a lot to learn about flipping houses before you actually start. Here are just a few of the key things to think long and hard about before you decide to flip your first house.

You need startup capital.

Of course the very first thing you need in order to buy a flip house is capital. Getting a loan for an investment home isn’t quite as simple as getting a home loan for a primary residence, and there’s definitely no 100% financing available for this type of investment. It’s usually a good idea to use cash to buy a house you’re going to turn around and sell soon. Even if you do decide that a home loan is the way to go, you’re going to need to come up with the cash for a down payment in additional to whatever cash you’ll need for renovation. And don’t forget that your flip might sit on the market for a while after it’s finished. During that time, you’ll need to have cash available to pay the mortgage, taxes, utilities, etc.

Finding the perfect house isn’t as easy as it looks on tv.

Television shows like Fixer Upper, Flip or Flop, and even House Hunters make finding the perfect fixer way easier than it really is. In actuality, finding a house to flip takes a lot of time, research, and trips back to square one if your offer doesn’t get accepted. There’s so much more to be taken into consideration than whether or not you think the house will make a good project. You have to think about the area it’s in and the type of buyer it attracts (single professionals, small families, etc.); the cost of renovation versus the actual post-renovation value; whether you’re over-improving for the area and won’t get back the money you spent, and much, much more. Make sure you’re working with a trusted, seasoned real estate agent to help you flesh out all these details.

You have to schedule things out to a tee.

TV shows also make it look like things simply fall into place as needed, but there’s a ridiculous amount of planning and scheduling that goes on behind the scenes. Once you find a house and actually buy it, you’ll need to get quotes and bids for various jobs, apply for permits, shop around for materials, and on and on. If you don’t have a super organized schedule, the odds are high that you’ll face a few challenges along the way. After all, you don’t want the drywall contractor and flooring installer to show up ready to work at the same time.

You won’t be able to do it all yourself.

Even the best contractors specialize in certain areas. For instance, someone who can build almost anything from scratch might not do sheetrocking, and they might hate painting. Good contractors know their specialty inside and out, and they know what they’re not good at, or what they simply prefer not to do. Just like a good contractor, you should be aware that you won’t be able to do every little job in your flip house on your own. This is especially important when it comes to specialties like electricity and plumbing. If you want to make a good name for yourself in the flipping business, you need to ensure a quality job each and every time.


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