landscaping looks terrible and cars are parked everywhere down the street, that would be a more difficult home to flip. Instead, look for neighborhoods that are kept up and there is pride in ownership in the surrounding houses. Buy the house that needs repaired and fixed up in this neighborhood.
Read the bank’s fine print.
Interest rates change all the time. If they go up, some buyers might not be able to afford loans; if they go down, your buyer pool may increase. Educate yourself on what rates loans are going for before you buy a property to flip! Look at it through the eyes of the end buyer! Would you get a loan right now?
Work with the seasons.
While unexpected hits could cause your construction schedules to change, do your best to shoot for putting your home on the market during peak times. In general, mid-summer tends to be the best time to sell, and mid-winter tends to be the slowest. That doesn’t mean you can’t sell your house in February; it just means that it might take longer, and you might have to list it for a lower price, or hold it for a longer time (thus increasing your holding costs...plan for this if it is the case). Know your local DOM for the time of year that your renovation will be completed. This is where your local Realtor® can come in very handy. Ask them to provide you with market data, or ask them which times of the year are best to sell in the city you are going to be flipping in. A well educated Realtor® should be able to educate you on the local conditions.
Make sure your ARV (After Repair Value) and renovation budgets are as accurate as possible.
If you don’t have a good estimate for the ARV before purchasing the house, you can get yourself in trouble when it comes to your
74
Powered by FlippingBook