Fix And Flip Real Estate - The Easy Money Days Are Over
You may wonder if it's still possible to fix and flip real estate and actually make money at it. Of course it was a no-brainer in the gung-go real estate market of the past few years. In those days, it almost didn't matter what you bought or how you fixed it up - market appreciation would always save you. If you made really good decisions, you could hit the bonanza. But even when you made really bad decisions, it was hard to lose money. Lots of people tell stories of buying properties with the intention of improving them, but then receiving an offer too good to refuse and just reselling the house without touching it, walking away with a big profit.
As we all know, those days are gone in most areas of the US. Nowadays, we're seeing price stagnation, and even declines in many markets. Now you have to be very careful when choosing a house to fix and flip. You have to make sure you buy at the right price. Many experts even say that's the most important part of the whole process. They say you make your profit when buying, not when selling.
Also, you have to make sure you set a realistic budget, and stick to it. Of course you'd like to have granite countertops and top-of-the-line stainless steel appliances in the kitchen, and a fancy master suite with a whirpool tub and French doors that open out onto an elaborate patio. This will make sure buyers can't resist, right? But will the area support that type of house? If you pay $150,000 and have $40,000 to fix the house up, and the highest-priced houses in that area sell for only $200,000, do you really want to base your whole flip on being the first one ever to get $250,000?
Of course, you also need to stick to your timeline for completion. Lots of things can go wrong, and those things can have a domino effect, postponing other work, until one day your realize your eight week flip has somehow become a six month project. This means you'll now have to deal with four extra mortgage payments, and that's if the house sells the day you list it. So being on top of the schedule and making sure everthing gets completed in a timely manner ranks right up there at the top of the list when it comes to making sure there's a profit at the end of the flip. So while the easy money days are gone for the time being, there are still a lot of people who regularly fix and flip real estate for a profit. They enjoy doing the research to find good flipping candidates. They thrive on using their organizational and people skills to complete the renovation on a timely basis, and they like the challenge of properly marketing the property to bring themselves a nice profit at the end.
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