Are you intrested in joining the hot real estate investment market place? You are going to need a quality contractor when you get involved into the already competitive marketplace. You will quickly notice that time and effectiveness will become your profits biggest ally. Making minor mistakes can really decrease your profit when you go to sell. Cutting corners and using inferior products can really have a serious impact. Using the quality staff at Southcoast Developers will make sure that you don’t have to learn from these types of rookie mistakes.
There are a number of ways to make money in real estate. Today’s marketplace has literally turned the rules upside down with a concept termed flipping houses.Traditionally, investors would purchase a property, fix up the home, and find a renter. We are more than ready to facilitate any need you may have and have had experience with many different types of difficult and complex real estate transactions. Have no fear Southcoast Developers is your understanding and reliable
What is House Flipping?
the concept of flipping houses was so popular popular during the late 90’s that over 40% of all transactions were flips. house flipping was arguably the hottest trend in the real estate industry more than any other type of transaction.
The concept of house flipping is a relatively simple strategy to explain, but much harder to execute successfully, The term is used to describe a three step process:
While this three step process sounds simple, making-money in real estate is never a sure thing, and the stakes are high. The driving force behind profitability has to do with inefficiency in the real estate market and how qualified your contractor is.. The “average” person looking to buy a home cannot distinguish between inexpensive cosmetic “damage” and more expensive structural problems.
Anyone interested in learning how to flip a house has to understand what a home remodeling contractor already knows. They need to be able to inspect a home, figure out how much it’s going to cost to remodel it, and do this accurately. Most first time flippers never make it through because they hire a contractor that they interview themselves and has no background in remodeling but is a under qualified handyman
The monetary rewards associated with house flipping can be great, as the example below demonstrates. The following table illustrates the simple economics behind this concept:
|Home Purchase Price||$350,000|
|Total Home Costs||$420,000|
|Home Selling Price||$500,000|
To make money flipping a home, each of the components in the above example need to work in the buyer’s favor, and this goes back to optimizing the three step process.
The first step involves identifying a “bargain” home. Typically, a good candidate is one that’s been ignored by previous homeowners, and is in need of purely cosmetic remodeling. Location is equally important and finding a home that is already close to amenities can really be helpful. Many times the present homeowner does not realize that spending a little bit of money renovating their home, such as a fresh coat of paint, will return to them many times the money spent on the paint itself.
Before purchasing your home you need to have a qualified contractor That means avoiding a home where the hidden “infrastructure” systems such as plumbing, heating, and electrical are falling apart. Plumbing and electrical repairs can be expensive to fix, and do not add much to your homes value unless coupled with upgraded to solar.
The example above showed $70,000 in remodeling costs. In this particular example, the money was well spent on clearly visible improvements that home buyers appreciate such as:
These are the types of repairs that home buyers appreciate, and will reward sellers by paying a premium when they bid for a home. That’s because they give older homes a “like new” appearance.
Though the heady days of the real estate boom are gone for now, real estate continues to be one of the safest investments you can make—that is, if you invest smartly. The key is to know what improvements to make, be realistic about what you can expect to gain, and to have a very clear idea of what is happening in the neighborhood. We can also make sure to put you intouch with a home staging company, a home staging company that specializes in getting your home decorating and moving services, offers the following tips to would-be real estate tycoons.
1 Do your homework
Before you even think about flipping a property, compare the home you plan to flip with other homes in the area. If a comparable property sold for $600,000 with a renovated kitchen and new appliances, don’t think you can get the same $600,000 by repainting the kitchen cabinets and laying down new linoleum. We will walk you through every step of the process
We will find out what other homes have had permits pulled in the same neighbor hood and note what upgrades have been made. Are the kitchens and baths fully renovated, with granite countertops and stone tile, custom cabinetry and stainless steel appliances, or more modest? Are there brand new hardwood floors throughout? Recessed lighting? A finished basement? Is the electrical and plumbing upgraded?
2 Upgrade landscaping and Hardscapes
Replace dead grass with fresh tile and stone . Use wood chips (try chocolate- or cedar-scented versions) or gravel to inexpensively cover large trouble areas. This will dramatically reduce the cost of water which is really important when looking into purchasing a home for the first time.
3 Spruce up the exterior
Paint flaking or dry-rotted windowsills and shutters. Paint the front and back doors as well as the garage doors, or if needed, replace them. Repair or replace broken or non-working eavestroughs. Repair or replace any aging or broken fencing. Finally, consider adding exterior lighting to enhance curb appeal.
4 Renovate the kitchen and bathrooms
These are perennial focal points for buyers, but you must find a balance between being cost-conscious and looking like you took the cheap route. Kitchens can cost between $15,000-$80,000, and bathrooms can run between $6,000-$30,000. Again, check the comparables and see what materials they used. If most of the homes in the neighbourhood feature granite countertops and brand-new appliances, then you should follow suit if you expect a similar price tag.
5 Replace/upgrade flooring
Again, check the comparables in your neighbourhood before you decide on what new flooring you should choose. If all the homes in the area have new hardwood, don’t lay down laminate, unless you want to sell your property at a lesser value.
You can cut costs by choosing synthetic versus natural stone tile, and sanding and re-staining hardwood instead of replacing it. Also, you can save by having your carpet company bind large remnants for bedrooms instead of installing wall-to-wall carpet. This should only be done if the floor is hardwood and in relatively good condition.
a simple few coats of pain from our team can really help but we advise that you paint the entire home exterior and interior—ceilings, closets, baseboards and interior doors. It will make the property feel brand-new. Our design staff will help you choose which colors best suite your street and neighborhood.
7 Change old switch plates
Nothing ages a property more than old, outdated and yellowed electrical plates.Dimmer switches in dining rooms, eat-in kitchens and living rooms add an inexpensive and nice touch. Wgen you have the attention to detail like we do we are sure to go that extra mile.
8 Install crown mouldings
Adding crown moulding is a non-structural change that can reinvent any interior. Avoid going the cheaper route as cheap crown moulding can make your home look even worse than having no moulding and traditional trim.. Make sure you choose a crown moulding of significant size that matches the style of the house, and make sure there are no visible seams once installed. Also, if you re-do crown mouldings, consider adding new baseboards as well.
9 Modernize lighting
lights run about $100 and up, making them a high-return investment. Consider adding new chandeliers in the foyer, dining room and kitchen. Check a large hardware chain for knock-off versions of designer fixtures that you can purchase for a fraction of the cost.
10 Upgrade plumbing and electrical
If you can afford it, the cost is well worth it, since the buyer will likely ask for more credit back on the purchase than an electrician and plumber would charge to complete the work beforehand.
Finally, make sure you have a savvy real estate agent on board who knows your specific neighborhood. Make sure that the changes you make bring your property up to a similar level to the competing properties in your neighborhood. Also, be aware of fluctuating markets. Don’t assume that a property that sold in your neighborhood a year ago will yield the exact same price.
Remember the goal to flipping is to make money. Be realistic about profit margins before you begin. You can’t sell a million-dollar home in a moderately priced neighborhood where homes go for a maximum of $600,000—no matter how much marble you use.