Where and When to Buy and Flip a Property For Resale Here’s my take on Buying and Selling Real Estate. Some obvious questions are; What are the various timelines for flipping a property?; How long should I hold a property that I want to flip?; When is a good time to buy real estate to flip? What are the various timelines for flipping a property? There are three different methods for flipping a property . One is slow-and-steady, which is buy property, move into it for two years, fix it up and sell it in two years. For two years you’re going to live in it then sell it ( hopefully) for the appreciation ( profit) and also to take advantage of the tax advantages, sell it, take your profits and buy another one and live in it for another two years. Continue to do that for four or five times. After that, you’ll eventually be able to buy that fourth of fifth house for cash because of the money from the profits you’ve accumulated. That’s one path, another path is buy a house, fix it up, flip it, sell it and then get into the next one. You’ve done it, you’ve gone through the process, you understand. Now maybe the next one, stay in for two years. There is no set way you have to do it. The beauty of flipping property is you can do it one after another or you can do them slowly, every two years, every three years. The trick is, do it, get your first one done and under your belt, understand the process. How long should I hold a property that I want to flip? There are lots of advantages and disadvantages to flipping quickly, or then selling and then holding. So there are lots of ways you can do it. It has to be a lifestyle choice for you. If you are doing this as a second revenue stream, then you can flip a property, and sell it, and keep doing it, whatever time permits. The only trick is when the markets fluctuate, which they do ( as we all know), you don’t want to be projecting too far in the future, because you don’t know exactly what’s going to happen in two years. We do pretty much know that in six months the market may be deflated by five percent, or may be inflated by five percent. So it’s hard to project out two and three years but make sure that if you do buy a property, that you have an exit plan for that property. Which means you can either choose to live in it if the market does go bad, or you can choose to rent it and cover it. Because you never want to be trapped buying a property and then being stuck with it and having to sell it for a loss. You want to know you can rent it or keep it for yourself. When is a good time to buy real estate to flip? What Donald Trump always likes to say is, “The best time to buy real estate is when other people are selling.” Right now, people are still selling and they will probably continue to sell over through the next year. There still plenty of foreclosures and distressed proprieties to keep the deals flowing. The best time to buy real estate is when the market is down at the bottom of the cycle, leveled out or on a slight up swing because that’s when you are going to get the best value. Where should I buy property if I’m a first time house-flipper? The greatest piece of advise I can give anybody as to where to buy a property if they’re going to be buying properties to flip, is to do it within driving distance of where you live. You need to be able to check on that property everyday while it’s in the process of being fixed up. People make huge mistakes by buying out of state, or buying two and three hours from where they live. It’s an enormous mistake, don’t do it! You need to check the workers on that property every single day. Remember each day costs you money from the day you buy and the day you sell. Have a repair budget and a timeline and stick to it. What kind of neighborhoods make the best candidates for house flipping? When you’re looking for fixer properties, it’s location. You always want to buy the worst house on the best block. Many very well established, beautiful neighborhoods don’t have fixers that are going to actually afford you the opportunity to make a lot of profit on them, so you always want to go right next to the best neighborhood or look for the property that’s in a neighborhood that we think is going to be up and coming, and that’s called a transitional neighborhood. It’s very much about trying to find the best property in the best neighborhood for the money that you have. What factors should I look at when evaluating a location for a house-flip? When you’re buying a property, you’re not just buying a property, you are buying a neighborhood, so you want to make sure that the neighborhood itself is solid. So you want to check things, like what’s the school system like? Is there shopping nearby? Is there access to freeways? Is there Public Transportation? You want to know the neighborhood. Now chances are it’s going to be near somewhere where you live, so you’re going to have some knowledge of it, but the buying in the neighborhood is just as important as the house you buy. What’s the secret to choosing a neighborhood that is increasing in value? I’m a big believer in buying in transitional neighborhoods. For example if you bought property in Jersey City when it was just coming up and now you can’t get in there outside of Manhattan. Here’s a great secret: If you’re trying to find a transitional neighborhood, look for a neighborhood that looks a little bit transitional but has just put in a Starbucks, fast food restaurants, bigger box stores etc. I’ll tell you why, and it’s because they spend an enormous amount of money in research and demographics of what neighborhoods are good, where people are going, and the relevant population. If they’re putting in a Starbucks, I can promise you that it’s a neighborhood that they believe is on the rise. What is ‘gentrification’? Gentrification actually means a neighborhood that has been in transition and is becoming more and more gentrified. This means the homes themselves are being worked on and renovated. The school system is being improved, shops, Starbucks, restaurants, and amenities are moving into a neighborhood. When a neighborhood is poised to be gentrified, that’s where you want to be. Once it has become gentrified it is beautiful established neighborhood. When you’re looking for neighborhoods or areas, you want to look for neighborhoods in areas that have some kind of amenity or some kind of draw. Of course anything that’s near a lake, or a beach, even though that may be very priced out if you’re starting to get in the market. Or things that have cultural elements to them, cities that are actually improving and growing. A lot of the southern cities now are having a big draw because of people who are retiring down to the southern states. You want to look for areas and cities that have some sort of draw because draw creates population, population increases the value of the property. Next time I will get into property valuations and basic formulas that will insure you make money on your investment flips. Here’s a free rehab tool to get you started.. click here to get your software You may also want to take a look at this mobile platform that will help you in your real estate business Sell your properties easily with this>>>> bit.ly/1fZLrqN Thanks for the Read Steven Settipani If you enjoyed this post (Buy and Flip) Please comment below Please share & like this page. See more here >>megamoneyconcepts bit.ly/18PJ2Zd
Posted on: Wed, 09 Oct 2013 19:48:53 +0000
Trending Topics
Recently Viewed Topics
© 2015