House flipping can be exciting if you know what you are doing. There are many things to look for prior to making a down payment. When house flipping, one should decide on what type of house they wish to flip. Prior to flipping your first house, you should study the market, allocate resources for renovations, minimize major renovations, research which renovation brings the most return and etc.
Study the market
When you are ready to flip your first house, it is a good idea to study the market prior to making a payment. When you study the market look at the current job market and the risk of unemployment. The better the job market the better chance of attracting buyers. When you are about to flip your first house you should have a contact list ready. The worst scenario for a house is for it to sit on the market. You can check out local demographics as well as national demographics here.
Allocate resources for renovations
Prior to making a down payment, you want to make sure you minimize the cost of your renovations. A good idea is to visit local scrap yards and buy wholesale. You must prepare yourself because scrap yards which are organized are hard to come by. It’s best to go as a team to the scrap yard and cover more ground. Allocating good contractors for a long term relationship is a good idea. Most people forget good contractors are tough to come by, but if you are willing to be a contractor yourself then you saved money.
Minimize major renovations
The best flip is the one which costs the least in your bottom line. If a kitchen has good cabinets but needs refacing or new knobs, it is a lot cheaper to replace. Changing flooring to brighter colors make a difference. When you have nice stuff, a dingy looking floor it takes a way from the appeal of the room. Paint colors can also make a huge difference when renovating your house. It is important to make sure the house smells fresh otherwise it will look like you are trying to cover a potential major issue.
Research renovation returns
Typically kitchens and bathrooms bring the most return. Most people spend a lot of time in those parts of the home. All the other rooms are usually personal choice and it is better to go with a neutral color when selling the home. Research how much a renovation typically costs prior to doing demolition. There have been instances where people go ahead with demolition without taking the time to make small fixes to see if it would make a big difference. Consult with your local realtor to see if your change is good for the local neighborhood. If you make a change which doesn’t fit the neighborhood or the future of the neighborhood ,you will not get the return you were hoping for. Google information on renovation projects.
There are many ways to start flipping a house. It is important to lock in research before you lock in finances. Consult, consult, consult. Good luck!