How to Flip a House Successfully: A Beginners’ Guide
When first learning how to flip a house successfully, some would have you believe its a simple process.
I'd LOVE to tell you that house flipping is super easy and you'll make a pile of cash on your very first flip...but chances are...you won't.
Does it get easier the more house flips you do? Absolutely.
Is it easy when you first start out? No way.
But it is very possible to learn how to flip a house successfully very early on in your house flipping career. Enclosed is a brief overview of how to do your first house flip in very broad terms.
Of course, there are always more resources and tips here to help you in more detail.
How to Flip A House Successfully...A Brief Overview
Knowing how to flip a house successfully involves an extremely complex process of multiple steps and check offs that need to be done in a very precise order to ensure maximum execution. But don't be intimidated because the fun thing about house flipping is that although there is a definite formula for house flipping success, no two house flips are flipped exactly the same way.
With a large amount of potential profit involved in house flipping, many Internet surfers are looking for an easy two or three-step process to learn how to flip houses successfully. So for the short attention span folks out there, below we outline the whole process in 3 simple steps which might come handy when you are learning how to flip a house successfully.
3 Steps On How to Flip a House Successfully: A Beginners' Guide
Step 1: Purchase a House to Flip
In order to flip your first house, you will first need to find a house to buy. The house can be purchased from many available sources such as: real estate agents, wholesalers, auction, short sale specialists, bank foreclosures, other investors or a homeowner who wants to sell desperately...the list is endless. We will go over all the many ways to find a house to buy in future posts.
Additionally, there are hundreds if not thousands of different programs out there being sold promising leads for house flippers, many popularized by popular television shows. But when learning how to flip a house successfully at least initially, the above list is a perfectly good resource list to find properties to flip.
Many new real estate investors get caught up and even overwhelmed, because they may have bought real estate investing courses that teach how to flip a house successfully and these new house flippers may spent many thousands of dollars on those courses. The key is to take action and come up with your own plan with the information you receive through your sources and research.
Step 2: Remodeling
In order to attract buyers, chances are pretty fair that you'll need to remodel the house before you can flip it. Remodeling the house is a process which should be done with a strict budget in mind and is crucial to your success as a real estate investor.
Just like when buying the property, controlling your costs in the rehab phase is just as important in order to maintain as much of your profits as you possibly can. Whether you use a general contractor on your team or if you use subs and you are the general contractor, you are the one to control the budget set forth between you and your rehab team.
We will talk about other ways to manage the process in future posts, but planning and sticking to a budget in this phase is crucial to learning how to flip a house successfully.
Using a budget repair form is a good way to keep track of the repairs needed as a snap shot is a very effective way to control costs. And you should use this form when getting estimates from multiple sub-contractors like electricians, plumbers, framers, finish carpenters and painters.
Once you've received all estimates from the subcontractors and finalized the pricing, then lay our a time line for completion. At this stage, you must do everything in your power to hold all the subcontractors accountable for the prices they gave you so you don’t go over the budget.
Step #3: Sell and Profit
The final step on how to flip a house successfully is the most obvious one...sell!
This is the part where all your hard work pays off if you did everything else correctly. And although there are many house flippers who like to do this themselves, I don't recommend it. Unless you are a real estate broker or if you are fully equipped to put some serious effort in doing this yourself, the best way to flip a house successfully in this final stage is to hire a real estate agent to list and sell the house.
To find a qualified real estate agent, look to your contacts. Chances are you probably already have some relationships built up when you were first looking to buy. Use those same real estate resources.
No matter what you do however, make sure that the real estate agent has a solid marketing plan to sell your property as quick as possible. This may include:
- Direct Mail
- Open Houses
- Newspaper Ads
- Internet Marketing and Facebook
Interview as many real estate agents as you can until you are comfortable that the plan they have is one that will sell the house quickly.
In the meantime, you can be on the lookout for your next house to flip while your real estate broker is marketing this one.
Although this beginner's guide on how to flip a house successfully will get you on the right path to flip your first house, it is by no means all-inclusive.
There is much to know about all aspects of house flipping. But one of the most important parts of the process is taking action, getting the right mindset, having definiteness of purpose and setting aside your fears.
Taking the first step oftentimes is the most difficult...but they get easier the more you take.