Flipping houses, if done the right way, can turn out to be a pretty profitable business for investors. However, there is very little known about house flipping from other than what we see on television and contrary to what many may think , house flipping is not a get rich quick scheme. It takes effort, resources, and more time than the half hour to hour programming we often see on tv. Here are a some common mistakes to avoid while flipping houses.
The project is too big
By no means should you not dream big when it comes to living your dream of flipping homes. At the same time, you need to to be realistic. The more work the house needs, the more money it will take to flip the home.
If you are in the beginning stages of house flipping, it would be best that you start off with low cost projects that you will give you less of a difficult time staying within your initial budget.
Not the best partnership
It is not uncommon to partner with another or multiple investors when flipping houses to offset much of the cost. While having a partner may seem like a great idea, the situation can often go awry if not thought out properly.
In order to avoid bad blood between partners, make sure you outline clear and precise job descriptions for what each partner will be doing, what each partner will be paying for, and when payments are due.
Starting off your partnership in the right way will lessen the likelihood of problems arising somewhere down the line.
Not having a realistic timeframe
Like mentioned earlier, flipping homes takes way longer than the 30 – 60 minute programs we see on tv. Purchasing, fixing, and selling a home requires a large amount of time. Furthermore, there is no set time for flipping homes, the length of each project will vary and here are a couple of reason’s why:
- Listing the home and getting it under contract. Homes will are not likely to sell as soon as they are listed. This process takes time. Try going with a listing agent and staging the home for open houses. It is possible that within 3-4 weeks your home can be under contract.
- Closing the home. After getting the home under contract, it can take anywhere from 30 to 60 days for the deal to close. However, keep in mind that it is not uncommon for contracts to fall through due to financing or inspection issues.
Stay tuned for our next article where will continue to delve into common mistakes to avoid while flipping houses.