We are moving into a golden era or property development. Now more than ever the demand for homes is staggering as young professionals want to star their own families. Getting on the property ladder is not so easy however as the demand does outstrip the supply. So where to go and who to see are the questions that millennials are now asking. Well, the government can only make so many homes during the year, so making the best of what you’ve got seems to be the best option. Yes, this does mean that existing properties need to be used to fulfill as many homebuyer wishes as possible. But they’re not all in good condition, so the only way for this to happen is if they were to be renovated, remodelled and resold. This is an incredibly lucrative opportunity for those that want to make a lot of money. On the other hand, in order to make money from flipping a property you first need to focus on saving as much money as you can.
Steer off the mainstream market
Real estate agents are looking to snap up as many properties as they can that look like they will turnover the most profit. Quite clearly this includes homes that have been abandoned, boarded up or just look old and drab. Yet, they themselves don’t want to renovate the properties. That would be far too complex and costly for the real estate industry to do for every single home that is rundown. So they will happily offer these homes out to buyers that are looking to flip them. But when they do, they try to get some value back or rather potential value. They are fully aware that you’re going to flip and make a lot of money so they try to literally guess how much the home could be worth. Inevitably, this shoots the price up.
Don’t go to the mainstream real estate agents, instead go to an auction house or event where such homes are going to be open to the public. However, if you don’t have the money up front and don’t have the time to go through the lengthy process of securing a loan for the property you’re interested in, then try a quicker option. Consider carefully these Bridging finance interest rates and costs. A bridging loan is just that, it provides a bridge to your goal; it's a sort of interim solution to financing a property until you can get a mortgage. The lender will need you to attach an asset to balance their risk, which of course can the property itself or another of suitable worth. This is a great alternative to getting a full mortgage and saving as much money as you can in the process of eventually selling the property.
DIY is absolutely essential
If you want to maximise profits then you must be assured in your own DIY skills. A lot of the home is going to need to be torn up and completely redone. For this to make any sense financially, you have to do most of this yourself. Therefore before you even take the concept of flipping homes seriously you must be able to be self-reliant. For example, you will need to take the kitchen cabinets off yourself, tear up the carpet, smooth down the hardwood floors and of course paint the rooms yourself. Everything that you see in the home which you know you’re going to be changing, should not be too big of a job to handle on your own.
Putting up shelves, cleaning the window sill, skirting boards, door frames, and taking off the kitchen tiling and replacing it are all just some of the things you will need to do. If you’re going to be calling over craftsman and other traders to do all these jobs, your profit is going to shrink next to nothing. Therefore you must have quite a bit of knowledge about redecorating, remodelling and renovation as a whole in general. Buy the best equipment that you can such as sanders and buffers to help you perform these tasks. It will take a long time and involve a lot of man hours but you’ll have much tighter control over your budget.
Going to a real estate to buy a home that can be flipped isn’t always the best option. Consider going to an auction instead where they can offer you flexible positions. Getting a mortgage for a property that you won’t have for more than a year doesn’t make sense, so get a bridging loan instead to get the ball rolling.