Want To Be A Flipper? Start At Home.

by: Brandon Marchand

Most big time real estate flippers and investment gurus will agree that most people are either time poor or money poor when it comes to investing in real estate. Novice property investors will likely not have the time to commit to a successful investment or flip, or lack the funds or knowledge to make a deal happen. This is one of the occasions when it’s helpful to think inside the box, literally. Think inside your home.

If you lack the time and resources to invest in and flip a home somewhere across town, start from within. Become a weekend carpenter, carpet layer, or cabinet installer and begin fixing up your home for profit. You don’t have to go big, just think big. Walk through your home and make a list of things you’d like to improve, prioritize them by the impact they’ll have on your home’s value (a Realtor or Property Investor can help if you get stuck, most Realtors do this free of charge). Next, set a budget. If some of the projects are currently out of your means – set a goal, save some money each month until you can reach your goal. Do the small items in between and finally when you’re ready – market your home and sell for a profit.

Now obviously there’s more to it than that – there’s a TON of hard work and effort that goes into flipping your residence. Not to mention the stresses of living in a home that is under construction, but if done right a novice come savvy investor can easily flip his or her residence every two years for large profits. Keeping your residence and living in it for at least two years will help you avoid costly capital gains taxes associated with profiting on a Real Estate Transaction – discuss the possibilities with your tax accountant to develop your own personal strategy.

Be sure to make your money on the buy. It’s important to buy right, and buy the property with the most potential. Granite and travertine only go so far on those Reality Shows. The big secret is getting premium pricing when you buy, and then cosmetically enhancing the homes features to maximize the profits when you resell. An experienced Realtor can help you find and evaluate potential investment or flip properties.

There are several other financing options that may make sense when flipping your residence. It’s always okay to leverage your home’s equity to add value. You must be absolutely sure you are making an impact on value, unless you plan on staying in the home and enjoying the new upgrades for some time. There are costs associated with tapping into equity and careful evaluations should be made, but if a $5,000 investment into the kitchen can yield $15,000 to $20,000 in potential return when you sell your home then the decision seems much simpler.

Always remember to start with a plan. Just adding fancy things to your home does not make it more valuable, treat it like a business. Every dollar you spend you want to make at least 2 back, or much more. If your home is already at its maximum potential – good for you, hopefully you didn’t pay too much for it and can stage it and unload it quickly. Remember to buy right on your next property to magnify your profits.