Choosing Home Flipping as a Career or Hobby

Posted by Gurpreet Ghatehora on Monday, June 30th, 2014 at 8:08am.

What is home flipping? Commonly called "flipping" this is the real estate practice of buying low and selling high, with a few stipulations.
 
How do I flip a home?
First off, you need to find a home that is a great investment opportunity. Sometime foreclosures offer this, but often it's just a matter of searching the market for a home that is undervalued. Undervaluing can be due to a home’s location, or it's state of repair. You want to find something in a good location that needs some work for your home flipping project. Once you find the place, the goal of flipping is to bring the home up-to-date as quickly as you can, and then resell at a higher price than you purchased at, in order to cover the cost of renovations and still make a profit.
 
Is there any risk?
Definitely. Home flipping carries several risks, including bleeding you dry financially. If the home you buy turns out to be a money pit, with far more issues than you thought, you can run into the problem of running out of money to fix it. Similarly, depending on the state of the market, you may finish renovating and then have a hard time finding a buyer - this will force you to carry the mortgage for too long and could break the bank.
 
Tips
Only buy in a market that is doing well for sellers. Secondly, don't bite off more than you can chew. You need to respect your budget and your abilities as far as home flipping goes. Finally, make sure you have a good float of cash to fund your project - don't flip a home with money you can't afford to lose.

Home flipping is a great way to make money, and is growing in popularity. There is a lot of information available online about how to get started.

 

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