In the past, individuals got into real estate investing to make money by serving as landlords. They would purchase a few homes, normally in their city or area, and would then rent them out. They made money each month from the rent as their home gained value with each passing year. After owning the property for 20 or 30 years it could then be sold for a large profit or held for monthly income.
While some individuals still choose to invest in real estate this way, others are finding they can make just as much profit by flipping real estate and making a quick sale. Although flipping real estate seems easy, many people have had their flip flop, because they didn't have the right skills and knowledge it requires. There are several ways for you to determine whether or not you have what it takes to be a success story.
One of the best determinants of how successful an individual will be in flipping real estate is how much knowledge and awareness they have of the current housing market. While many individuals assume it is enough to know whether or not the current market is up or down, in reality it takes much more than this. Individuals must know all about homes in the area; including their value and what they're selling at. In addition they must know about the rehab industry and what costs they are going to incur flipping a home. Many individuals underestimate their budget when flipping real estate. They are unaware of the true cost of supplies and labor. Knowing all of this information is very important in order to have success flipping.
You may assume that you must have handy skills to repair and quickly sell your house but this isn't true. Any work that needs to be completed on a home can be hired out, and many deals require little or no work at all.
If you are going to fix up houses before you flip them, be aware that you can easily be taken advantage of by contractors if you're not active in your flip or you're unaware of the approximate pricing and timeline for a particular project. This is why many professionals recommend that individuals receive multiple bids for projects when flipping real estate.
Once you have hired contractors for a flip, it is important that you have the managerial skills necessary to ensure the contractor stays on the agreed time schedule.
If you're going to start flipping real estate, make sure you're an excellent problem solver. Every flip encounters an unexpected problem at some point. Water leaks, mold, rotten wood and more are just some of the things you may discover as you prepare to quickly sell your house. These often require adjustments to the budget and timeline which you'll have to figure out.
Finally, individuals who want to make money through real estate investing should be self-motivated. Once you purchase a home for a flip, no one is going to provide you with deadlines or a to-do list. Instead, you must be able to generate self-set deadlines, budgets and tasks. If you don't have the skills and motivation to complete the project, it won't get done. This will prevent you from being able to quickly sell your house.
While many individuals choose to make money slowly through renting out their properties, others are choosing to flip them for a quick profit. You, too, can be successful flipping real estate, if you have the skills and knowledge you need before you buy your first home.
