The real estate business is always changing. Center Street Lending can help you stay ahead.
According to RealtyTrac, the average gross profit on a flipped home in the second quarter reached $62,000, a 10-year high after the flipping business has been retooling for the past two years.
The house flipping industry has undergone dramatic changes, but it has grown even more profitable during that time.
Learn to become a successful flipper by analyzing recent changes that have occurred over the past ten years and what lessons you can apply to your skills. Read this original article at CenterStreetLending.com and follow us on Twitter and Facebook.
The House Search
Finding houses has grown increasingly difficult. Becoming licensed helps with researching available homes because you will be aboe to access to the multi-listing service (MLS) in your community. A real estate agent also will be able to tell you if these properties are owner-occupied sales or estate sales
While you still can find foreclosures and bank-owned properties, these are getting harder to come by and banks are seeking closer to market prices.Sometimes families are willing to accept less for a property if they get a quick cash payment, rather than waiting for a long escrow period.
You can sometimes find properties for sale by owner when can often be acquired more cheaply if the owner wants a quick sale.
Cash in hand also will be important to finding houses. The percentage of buyers paying with their own cash as flippers has climbed to nearly 70 percent this year, nearly double what it was 10 years ago. But they also reported a growing interest in private lenders who quickly approve loans, which allows new flippers to enter the market at a competitive level.
Whichever route you take, you can expect to pay more than you did for houses during the housing crisis, but the good news is you can expect to sell the house for more, too.
What also has changed since the housing crisis is the type of house you can buy for a good price. When the foreclosure market was at its peak, you could get houses that were generally in good shape, that needed only cosmetic changes before they could be flipped.
Now, the houses you likely able to acquire at discounted prices are those that are out of date and need some modernization to appeal to current buyers. You’ll need to look at opening up the floor plan, adding more expensive amenities, particularly wood or laminate floors and kitchen upgrades such as marble or granite countertops and stainless steel appliances, and a master suite with bathroom.
All of this will require more money and more time, but the payoff in the end is greater as the housing market continues to heat up.
The most critical aspect of a successful flip is selling at your target price. A tightened housing market helps when you sell your newly renovated home. While interest rates remain low, more home buyers are getting into the market, leading to those greater profits.
Do your research, and find a home in a desirable neighborhood, and make sure you have the cash for the renovations necessary to make it sell.