Flipping A HouseFlipping a house can be done many different ways. I will mention two of the most common and easiest to learn methods for the beginning real estate investor. RehabbingThe most common way people start flipping houses is by rehabbing. It is also the most common way people fail as house flippers.Many wanna be investors forget to take into consideration the expenses involved in purchasing, holding, and selling a home. This is the reason that many of the "Flip A House" TV shows are now showing the harsh realities coming in over budget. Rehabbing a house is the process of finding a fixer upper and buying at a low price and subsequently fixing it up and selling high. The key word being "low" when purchasing. It should be noted that "high" really means higher than your expenses including profit but lower than the other houses in the neighborhood. When considering flipping a house always run your numbers and intensely analyze a deal before purchasing. Don't forget how much purchase, sales and holding costs will be not just rehab costs. Get 3 quotes for all major projects unless you are a contractor or have expertise in the field. Check the contractor's references. Do not hire a General Contractor, because you will have too much riding on that one person. Don't over-improve. Keep it simple and remember what the other houses in the neighborhood look like. If everyone in the neighborhood has laminate counter-tops, don't put in granite. Your house will still sell with a really nice laminate and you will save a few thousand dollars. Don't under-improve. Paint and carpet rehabs are ideal, but don't try to put paint and carpet into a house that needs to be torn down and rebuilt. It seems obvious but I have seen some real winners. Try to sell the house For Sale By Owner or find a discount broker. If you are going to be doing this more than once, tell the broker and request a discounted commission. If the know they will receive more commission in the future they will come down. Make sure the house is clean and the rehab is 100% complete before you show it or put it on the market. Price the house below market value. Find out what the houses are selling for in your area and price it 5-10k below. Everyone loves a deal and you will sell before your competition. Being greedy will only get you a bad reputation and a lot more stress. WholesalingWholesaling property is finding a piece of real estate at a low, wholesale price and selling it low. Typically assigning a contract to another investor is the easiest best way to do that.Assigning a sales contract to another party is easy. In the spot where you write or type your name in as the buyer you add "and or assigns" after your name. These important and powerful words give you the authority to assign your interest in the property to any other designated party. You will use an assignment agreement to lay out the terms but by writing you name on the agreement with that phrase you can "assign" or sell that contract to another party. A typical assignment fee is $10,000 but I have seen some as high as $50,000 or more. You will find a discounted property, give the homeowner a small deposit (10-100$), sign a sales contract and sell it to another buyer. This technique leaves you with minimal exposure by way of money invested and gives you complete control of the property. This is my favorite technique to use when flipping a house. These are just a couple of the many ways I use when flipping a house. I have found these to be the most profitable ways to buy and sell houses. A great way to create equity when you find a house that you are interested in is with a short sale. This is when you negotiate with the mortgage company of a homeowner who is behind on mortgage payments to take less than what is owed. Get Our Free E-Course Training Guides and Tips
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