My initial interest in investing in flipping houses started nearly 20 years ago. And by interest, I mean looking at business opportunities where I could be an entrepreneur. Though, at the time, that idea was not very popular. Everyone…and I mean everyone was in technology. And that was definitely not a profession I wanted to pursue.
For those of you who are thinking about getting started but not ready to buy, these steps are for you. Steps that are based upon what I wish I would have known when I wanted to get started flipping houses but had no idea how.
1. Seek the people and events where people are ahead of you in the process.
Whether they are acquaintances, people who work in real estate, or local meetups. Any of the above can be a place to interact, observe and learn. This is not the type of business that you come across every day unless you are being intentional.
2. Use the free resources available to educate yourself.
There are a few websites that host the same information as the MLS (multiple listing service) that agents use. Check out different neighborhoods in your area and see what homes are listing for and what they are selling for.
Drive around the areas you think would be good for flipping houses and check out the neighborhoods. Are there roads with heavy traffic that you would want to avoid? Did you notice if the areas with commercial buildings are near single-family homes? Are there recent flips or new construction homes in the area?
3. Keep a list of people you meet and their area of specialty.
No, you don’t have to keep every business card but a Google doc can be a lifesaver. Also, when you meet someone, like another investor, ask them if there are any preferred lenders they would suggest? Add that to your list, even if you don’t need one right now. Preparation plus opportunity is where success happens.
4. Start analyzing numbers.
Open a spreadsheet and use generic numbers to start seeing the results. For example: purchase price 100,000.00, renovation 50,000.00 and resale price 250,000. Use 5% for purchasing expenses and 10% for selling expenses and see what your profit would look like. Now, when you find a house and look at the resale, you will have an idea of the range for your renovation budget. If that number is low and the house is a wreck, then you will know its not a deal.
Whatever steps you can start now are the ones that will best prepare you when that right property shows up. I encourage you to get started learning more about flipping houses rather than later, especially as we are upon a new year. Just think, 365 days from now instead of just thinking about getting started, you could have 1 or 2 projects under your belt, and several new skills personally too.
Want to buy a property and renovate it?
I have a freebie checklist that will help you — 8 Things I look for When Purchasing a Home. Just click here to download it.
Love before and afters?
Looking to buy a house to renovate? Check out the fixer upper checklist to help you find the perfect house.
For more inspiration for home renovations, follow me on Pinterest @thresholdhomesmn