Flipping Houses: 10 Important Steps Before you Even Pick Your Paint Color (Part 2)

PART 2 – Essential steps to take into consideration prior to diving into a new flip:

  1. Find a Realtor.
  2. The benefits of a realtor are numerous, especially since the seller is paying their fees. They can help you find great homes, check the comparable homes in your area, write your offers, and handle the legal paperwork when you find the right one. Be sure to find a good agent with experience in investment properties. However, if you are using direct mail to find your flip or looking at homes that are For Sale by Owner, you do not want to use a realtor.

  3. Research & Decide Your Criteria.
  4. Once your realtor is in place, go back to your research and decide the criteria for your flip. In what area should you buy? Why type of house? How big or small? What is the most you are willing to pay? Knowing these criteria will eliminate wasting time on the wrong properties and allow your agent to find you what you’re really looking for.

  5. Start Running Numbers.
  6. Once you know what you want, start running numbers. Practice calculating deals. You want to be sure that when you find a good house, you know it’s the right deal. Watch the market in your area. Analyze their sales, run the numbers using the Flipping Math and see what kind of deals they really are. Practice so that you can be confident that you have found the right one.

  7. Keep Your Head.
  8. At this point you have analyzed everything, know what you want, and have practiced scenarios. You’ve got this! Now is not the time to get overly excited and forget everything you’ve just learned. Be patient. You will find the right flip. Don’t allow excitement, anxiousness, or emotion to take over.

  9. Make an Offer You’re Comfortable With.
  10. When you find what you’re looking for, make an offer that you are comfortable with. Don’t be afraid to offer a lower amount than the asking price. Both you and the seller are trying to get the best deal, so counter offers and negotiations usually take place. Don’t lose sight of your end goal. You may be tempted to accept an offer that will not work with your Flipping Math equation.
    Remember that this is a business deal; keep to what you know fits into your equation. If you lose sight of that, you could end up overpaying and lose a lot of money. If you come to an agreement, move forward, if not, begin a new search. Don’t be afraid to lose a property that no longer makes financial sense.

  11. Plan a Home Inspection
  12. If an offer is accepted, your next important step is to get a home inspection. Surprise expenses are never fun expenses; do not skip this step. This will tell you everything you need to know about the house. Do not hesitate to renegotiate the deal if the inspection reveals costly issues. Once issues are revealed, the buyer will have to address them either with your or the next buyer. Ask the seller to either fix costly issues or credit you the cost to repair them. In the end,
    it’s your deal and the deal must fit your plan.

    Now that you have learned and practiced these steps, you will be better equipped to find the right property to flip. It’s out there. Remember these 10 steps and make your first, or fiftieth, flip a success. Once you get these down and find “the one”, then the real fun begins!

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    Turner, Brandon. [2014] Flipping Houses: The Ultimate Step By Step Guide. [Blog] Retrieved from
    https://www.biggerpockets.com/renewsblog/2014/01/07/flipping-houses/

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2017-12-21T23:25:00+00:00