I often get asked if there is money to be made in flipping houses as is witnessed and somewhat glamourized on several tv shows. The answer is yes IF your project includes 5 key ingredients.
- You must select the RIGHT property and pay the RIGHT amount for the property. The right property is one that is a diamond in the rough – is selling for much less that other properties in the area, because it is not up to the standards of the neighborhood. The purchase price must reflect the costs required for renovations, and the profit that you are expecting to realize for your hard work, and efforts. The renovations should get it up to the neighborhood averages not create the most expensive house in the neighborhood.
- A house flip must be treated as a full time business as it must be done right and quickly. Time is money.
- Do the right renovation for the area. If you neighbourhood commands 4 bedrooms and you build 3, you may have an issue selling for top dollar.
- Do quality renovations. Potential buyers love to purchase renovated homes with all the bells and whistles however they will want to make sure that you did not cut corners just because you were flipping.
- If you can answer yes to the above, you are well positioned to make a nice profit from your flip!
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