People have made money by buying distressed houses, fixing them up, and then flipping them for hundreds of years. It's not a new concept. But what if you live in an area where homes rarely sit on the market for more than a week, sell at full price, and require conventional financing because there are so many qualified buyers standing in line to buy them? Can you still make money flipping houses under such market conditions? The simple answer is yes, if you do your homework, find the right property, and have a certain amount of luck on your side.
It's been a sellers' market in the United States for a number of years, with more buyers than houses, which means that sellers haven't been as motivated as they were back in the 80s, when interest rates were sky high, inflation was running rampant, and qualified buyers were scarce. But that doesn't mean that you can't still find sellers who are willing to bargain, because like in every age, people get into trouble for various reasons. You can use that fact to your advantage to make money under any market conditions.
One key is to find the right property. You're not looking for the sweet home in a beautiful neighborhood a few blocks from a great school. Lots of buyers will be lining up to make offers on that house. Those houses won't interest you. You're looking for sellers that have found themselves in financial distress, for whatever reason, and need to sell within a short period of time. They will have motivation, and will be willing to work with you to overcome the difficulties they are facing. Those are the houses that will make you money, regardless of the overall market in that area.
You generally won't find these homes listed in your local MLS, and if they are, you can bet that there are a number of agents already peddling those properties to investors they work with regularly. You'll find better luck if you run ads, offering to help owners solve their financial problems. You can write sensitive letters to people who have inherited properties for whatever reason. Regardless of how you find your sellers, always emphasize that you want to help them. If you're sensitive to their needs and make a genuine effort to do your best to solve their problems, you'll find many sellers quite willing to work with you. You're not trying to steal their property. You've genuinely trying to offer your help. That instantly puts you ahead of your competition.
I hear you shouting: "That's the same B S all the late night infomercials pedal!"
You're right. Every real estate investor wannabe runs ads, week after week. But wait, (are you laughing?) aren't some of those ads the same ones from last year? That's right. These investors still make money, year after year, running the same ads. The only way for you to compete is to really sound sincere when a distressed seller calls YOU. Try to answer the phone instead of relying on a message. I promise, this makes a huge difference. Distressed sellers just go down the list until they get a live person to talk to.
Regardless of the market conditions in your area, there ARE sellers out there who are in need of your help. If you can give it to them, you'll find yourself profiting handsomely, too, in more ways than one!
