Prestige Real Estate
Prestige Real Estate
Donielle Dodson, Prestige Real EstatePhone: (785) 418-6441
Email: [email protected]

Tips for House-Flipping

by Donielle Dodson 02/09/2020

Image by Andy Dean Photography from Shutterstock

In past housing markets, it was common for investors to flip houses. Unfortunately, when the housing bubble burst, many buyers couldn't update and sell the homes they'd bought. After a bit of a downturn, the trend has picked back up. However, savvy investors know that the housing market has much tighter margins than it has in the past. If you’re thinking about getting into the house-flipping game, consider the following tips as you get started.

Here are some tips to protect your potential investment:

  • Not every housing market is profitable: Many homes can be purchased, renovated, and potentially sold in every part of the country. But some locations do not have the sort of economic growth that makes property flipping viable. Know your market and local property values. Keep in touch with what’s happening in the community and be prepared with a plan B in case the home doesn’t sell.

  • Do your homework. There are fewer deeply discounted homes available to investors. Plan to pay the full price in cash but arrange a contingency to have the home inspected. If the inspection reveals issues, especially with primary systems such as electrical and plumbing, walk away. Or, offer the seller a lower price to account for needed repairs, and potentially get a better deal. Anything revealed during the inspection that the seller did not fix your responsibility to repair or replace before you can flip the property.

  • Respect your margins. Unlike in reality shows the profit made from buying and selling a home is not as large as it appears. When you find undervalued homes, you need a cushion built-in for the rehab. If the difference between what you paid and the new selling price is insignificant, it’s not a sound investment. Avoid purchasing property that requires thousands of dollars of repairs or upgrades. You'll end up with a lovely home, but little to no income to show from it.

  • Constantly monitor the inventory. Fewer homes on the market mean finding one with flip potential is more difficult. 

Seek help from a professional

Maintain a close relationship with your real estate professional so that when potential homes come on the market, you’re the first to hear. Your real estate professionals know the local market. They watch the trends and know who is buying, who is selling, and who is holding. They also know which repairs and upgrades are essential to make a quick sale. Let them guide you.

About the Author
Author

Donielle Dodson

  • I grew-up in Ottawa, Kansas, attended KU then moved to southern and northern California where I owned and operated a small business. Living away from Kansas for those years helped me realize what a beautiful small town Ottawa is and how much I really love the Kansas City area!!
  • I will enjoy helping you with a home, land or commercial sale, purchase or lease in Kansas or Missouri!  
  • I'm a licensed Broker & e-PRO in Kansas & Missouri, a member of the National Association of REALTORS® & donate to RPAC, a member of the Kansas City Regional Association of REALTORS® (KCRAR), CCIM (Certified Commercial Investment Member) Kansas City, Costar, advertiser on Heartland MLS, LoopNet, Realtor.com, Zillow, as well as various social media sites.  
  • My volunteer activities include Rotary International, the City of Ottawa Planning Commission and Board of Zoning Appeals. I'm an Ottawa Chamber of Commerce Member, 2018-2019 Franklin County Leadership Class Graduate and 2019-20 UMKC REALTOR® Leadership Academy member. 
  • Broker License Numbers - 00237137 KS & 2018028154 MO

I work in many of the surrounding areas, up to around an hour drive from Ottawa. If I don't work in your area, I will refer you to another excellent REALTOR®!