It’s on all the television networks. There are countless shows about interior designers, real estate agents, and even just average Joes doing it. Maybe you’re interested in doing it yourself.
Regardless of what you do or do not know about it, you’re probably asking yourself, exactly: What is house flipping? Well, you don’t have to be a professional to do it, but you do need a certain set of skills. Below, you will find some answers to your common questions.
What is house flipping?
House flipping is, essentially, buying a house with the intention of selling it for a profit. What you do in between the buying and the selling depends on a lot of different factors.
Do I have to renovate the house?
Not necessarily, but once again, this depends on the situation. If you buy a house that is cheap because it is damaged, in order to make a profit on it, you’ll have to fix what is damaged. That said, you need to do so in a way that doesn’t lower the equity of the home. For example, if your repairs will add $2,000 to the house’s value, you don’t want to spend $2,000 (or even $1,500, really) on them.
Do I have to make mortgage payments on the house?
Most house flippers plan their flipping so they won’t have to make payments, as that creates a loss of equity. For example, if the payments are typically due the first of the month, you’ll want to buy the house after the mortgage is paid, make sure any renovations or changes are finished as soon as possible, then sell the house before the next mortgage payment is due.
Do I need to buy a certain kind of house?
Yes and no. No, there isn’t a specific type of house reserved for flippers, but yes, you need to buy a type of house that you are confident you can flip and sell. Oftentimes, foreclosed homes are sold for much cheaper than they’re worth, which makes them good candidates for flipping. That said, foreclosure and other factors may affect the equity of the house.
Do I need money to begin flipping?
Yes, you do. You need to be able to afford the mortgage on the house, just in case. Although your plan will not include paying the mortgage, you don’t want to end up in a sorry situation if something happens.
Get More Information From The Pros
Real Estate is a tricky market. If you need help navigating it, we can help. At TalkLocal, we connect you with the professionals in your area who have the answers you need. These can range from real estate agents to handymen that could offer assistance in fixing up a home.
