hard work, and being in a location that you enjoy and feel connected to will help. Plus, you’ll know the area well, which can be advantageous in many ways, as well. Once you’ve decided on a market, it’s time to look at inventory levels . This means finding out how many homes are for sale. Keep in mind that low levels (e.g., few houses for sale) can be a good thing, because it means it’s a seller’s market. Ideally, you want your market to have less than four months of inventory. The following are the different types of markets to look for: • Hypermarket: Less than one month of inventory; little to no competition. Listings tend to sell above asking price after receiving multiple offers. • Seller’s Market: Less than four months of inventory; low competition. You will likely sell for a good price. • Stable Market: Four to six months of inventory. Properties might take longer to sell, and could sell at or below asking (if they sell above, it probably won’t be by much). • Buyer’s Market: More than six months of inventory; lots of competition. Properties take a while to sell, and often sell below asking. I suggest that flippers focus their efforts on hypermarkets and seller’s markets, as these will bring in the most profits. It might be hard to find that initial right property, but it’ll be worth it in the end. In addition to looking at the overall inventory, you will want to look at the average Days on Market (DOM) , so you’ll be able to make an educated guess about how long it will take a property to sell. This is something I can help with by researching similar types of properties that have sold in the previous 30 days.
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