Flipping Real Estate
Flipping Real Estate: Fact or Fiction?
Your Quick Guide to Making Money Flipping Real Estate in 7
Simple Steps...
Every time you turn your head, someone else is talking about
flipping real estate. What are they really talking about and is
it something that YOU can do?
First, let's define the two types of "flipping real estate".
1. Flipping the contract: (Also known as "assignment of
contract") You find a property for "pennies on the dollar", put
it under contract and then "flip" that contract to, most likely,
someone that is going to do the rehab, or renovation on the
property.
2. Flipping real estate: Buy a property, fix it up, and resell
it to an "end buyer". This is known as "flipping real estate",
"rehabbing", or "retailing" to name a few. OK, now that we've
gotten the terminology out of the way, I want to first start by
telling you that real estate is simple, but not easy, so if
you're looking for a get rich quick scheme, you're probably
going to get yourself into trouble. Now... on to how YOU can
make money flipping real estate. We're going to focus on the
second definition of flipping real estate: buying, fixing and
reselling.
Step #1 - Find the Right Deal If I made a dollar every time
someone told me there were no more deals, I'd be a
multi-zillionaire by now! Here's the thing and I want you to get
it through your head! There are PLENTY of deals - even where you
live! Make a consistent effort to really look for houses that
are overgrown, in need of paint, possibly boarded up, etc. These
are going to be your best bet for flipping real estate.
Step #2 - Estimate the Repairs You can either go ahead and bring
a contractor or handyman with you or you can get a simple
calculator that will figure out the "rough" numbers - like the
one found at http://www.fixingandflipping.com
Understand, however, that more often than not - like 99.99% of
the time - your budget will come in lower than your actual
costs! You may also want to have a home inspection to check out
the major items: foundation, roof, plumbing, electric, HVAC, etc.
Step #3 - Negotiate the Contract This is where many people run
away from real estate. "Contract" is not a four letter word! In
fact, it is your best ally when you are negotiating!
Use your contract negotiations to pay for the repairs by getting
seller contributions and repair credits. This will keep you from
having to dip into your own pockets for repairs!
Make sure that you have a way out in case the deal isn't going
to work for you. Some "escape" clauses that you can handwrite in
are: - "Subject to satisfactory appraisal" -"Subject to
partner's approval" - "Subject to satisfactory inspection"
Step #4 - Find Your Money Don't get caught up on this one!
Finding money is really much more simple than you might imagine
if you've followed steps #1 - #3! I know it sounds clich