Everyday there’s a new training program that advertises the promise of making millions by implementing their special formulated practices. The reality is, flipping homes is super simple and that’s why there is so many people doing it.
After leaving the corporate world, I quickly jumped on the “flipping” bandwagon. I had finally reached the point of hating my 9 to 5. So, I turned in my punch card and never looked back. Now, my car is my office. It comes with great perks too! Driving all day? Who doesn’t love a free tan compliments of AZ sun? Sarcasm aside, I love what I do and the ability to flip homes is a definite plus. I didn’t have an expert mentor. I didn’t attend a seminar where the “secrets” of flipping were bestowed upon me. I just went for it.
Here are two tips important for anyone interested in taking that leap:
1. Not Every Home is a “Homerun”: Many of my investor colleagues complain saying “There are no longer any good deals!” When you translate this, you will find that what they are saying is that there is no longer many “homeruns”. You see, it is harder to get homes that will easily flip for a profit of $40-70k in a few months. These seasoned investors got used to making big bucks with every flip. With those days behind us, they complain that there are no longer any good deals. I completely disagree with this! There are many good deals. There might not be as many opportunities for “homeruns”, but there are plenty of good “pitches”. In other words, there are a lot of great deals available where you could make $12-16k. So currently my focus is on seizing the opportunities available to me and getting as many “hits” as possible. In the process, I am gaining a lot experience and enjoying the excitement of it all. So if you are going to try your hand at “flipping” in today’s market, seize your opportunities and be happy with a “double” or even a “single”.
2. Don’t Expect All YOUR Homes to Sell at Top Dollar: Too many times people jump into the industry, buy their first home, spend significant money fixing it, list it at the highest price possible, and then get frustrated when it takes more time on the market to get a less than asking offer. Guilty!! In the current market, the best thing to do is a “moderate’ remodel. In other words, don’t “pimp it out”. Don’t go too crazy and invest on the most expensive features. I’m not saying those homes don’t sell, but it takes longer and they usually sell for below asking because a buyer doesn’t see the same value. The homes that are selling the fastest today are the properties that are in good shape, have an average price, and a “moderate” remodel. Disclaimer: as with all things real estate – LOCATION, LOCATION, LOCATION. If you are flipping in a Luxury or Historic area, I would recommend going all out. Do your research first – these areas often have special rules and regulations regarding upgrades.
There you go! These are two simple tips that are helping me in this market. So if you don’t mind driving in the heat, being on the phone most of the day, and getting rejected you might be ready to flip a home!
I hope you enjoyed reading about my experience. Let me know how I can help you with yours!
Modesto Lopez | 602.710.6533