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| The House Flipping Trend |
Picture this: You purchase a run-down old house at a local
auction. The house is falling apart, maybe even in the kind of
ways that require Condemned signs, and you walk away thrilled to
have spent $65,000 of your hard-earned money to own it. What
world is this?
This is the world of house-flipping. If you haven't heard of
house-flipping, chances are you don't work in real estate.
Then again, neither do many house-flippers, at least not at
first. House-flipping is the new term devised for people who buy
properties in bad shape, ideally with little structural damage
but plenty of cosmetic wounds. These people rebuild the houses
within a strict profit margin, and use a little real estate
know-how to produce a salable house, ready for the market. Then
they sell it for many times the price of original investment
plus construction.
With the real-estate market |
booming, more and more everyday
people are getting involved in this business of fixing up real
estate to sell. Some people live in the houses as they flip
them; others just buy, buy, buy, send out crews, hold open
houses, sell, and buy some more. It all depends on your budget,
and the kind of flipping you're willing to do.
It generally takes a professional, with lots of investors and
money in the right places, to take a truly destroyed property
and make it salable. Amateurs do best sticking to houses that
might have terrible paint (or no paint at all), ripped-up lawns,
bad tile, and other cosmetic damage that they can fix at low
cost. Once you get into the horrors that can be caused by
termites, rotten wood, and caving ceilings, you're probably
talking about a job for the professionals.
Of course, many shrewd house-flippers, even the ones with
investment backing, won't |
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flip a house with too much damage. You
might fall in love with a rustic old Victorian and cherish the
idea of restoring it to glory, but the world of a house-flipper
is all about profit. Those who get emotionally involved with the
properties are in trouble. Before you know it you'll find
yourself in over your head trying to fix problems whose expense
is going to far surpass what you might be able to sell the house
for later. A true house flipper knows when to walk away.
For anyone intrigued by this new trend in the real estate
market, it helps to know as much as possible about your local
real estate market. Maybe a house with some fairly serious
damage is still worth the cost of repair if it's located in a
prime area. Informed flippers will know at a glance what might
be worth their time. The world of house-flipping is an oddly
shrewd one, considering the creature comforts they |
work with
every day. These are people that are able to thrill over
installing a cathedral ceiling, and walk away from it at a
moment's notice if it flies over budget. These are not people
who go weak at the sight of old paneling. They might go weak,
however, at the cost of repairing it.
It all boils down to a numbers process. Those interested in
house flipping should start slowly. Study the market, watch the
numbers, and get advice wherever possible. When you make the
plunge and purchase your first flippable house, congratulations.
Now don't get attached, because if you do your job correctly, it
won't be yours for long.
About the author:
Kirsten Hawkins is a real estate expert from Nashville, TN.
Visit http://www.king-of-real-estate.com/ for more information
on real estate, mortgages, and finding the house of your dream.
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