Maybe you’ve been binging HGTV, maybe your brother-in-law flipped a house once and made bank, or maybe you’re just looking for a fun new way to earn money. In any case, you’ve probably heard a thing or two about house flipping.
House flipping has become a very popular side hustle in recent years as a way to profit from an increase in a home’s value. So, grab your hammer and nails- and some wallpaper samples- and let’s dive into the world of house flipping.
What is the Average Earning from Flipping Houses?
In 2021, the average house-flipper earned around 68 thousand dollars per flip. It is important to note, however, that the profit per house will vary based on the original price of the house. Cheaper houses will likely yield more modest profits than more expensive ones.
What Do You Need to Start Flipping Houses?
To begin flipping houses, you should first conduct research on the current housing market, as well as on the neighborhood or area in which you plan to buy.
Next, it is important that you assess the kind of skills that you possess. Certain aspects of flipping include home renovation skills and insurance, legal, and real estate expertise. Not all who flip houses possess all of the hands-on-renovation skills necessary.
You will need to assemble a team of people that can assist you in the many phases of flipping homes. Having this diversity of talent will ensure that the process will go smoothly, though you must budget your team’s compensation into your flipping costs.
Then, you will need to buy the home. This will often require qualifying for a home loan from your bank or financial institution.
Does Flipping Houses Always Bring You Profit?
Will you always make a profit when flipping a house? No.
The volatility of the real estate market is the primary factor in whether or not you will profit off of your flipped house. Depending on the state of the overall housing market and the area in which you’re buying, the value of your home can rise or drop on a dime.
Because of the relative uncertainty of the real estate market, your best efforts to increase the value of your home may not always yield results. Therefore, making wise financial decisions and diversifying when getting into house flipping is important.
What Are the Common Mistakes in Flipping Houses?
Most commonly, the mistakes made in the process of flipping houses include the following:
- Underestimating the monetary investment required
- Underestimating the time investment required
- Overestimating one’s own skills, knowledge, or expertise
It is important to obtain any help necessary in accurately assessing the expenses flipping will require.
When is the Best Time to Start Flipping Houses?
There are a number of factors contributing to good times to flip houses.
First, you will want to ensure that interest rates are low. That way, your initial investment will be less costly, and buyers will be far more eager.
Second, summertime is the best season in which to flip. Homes are sold and bought in a far greater quantity during this time, as school years end and transitions are made.
Third, you will want to begin flipping when there are fewer properties available in the housing market. Buyers will be much more eager to make an offer on your property in such economic climates.
Final Thoughts on Flipping Houses
If you’re ambitious, ready to roll up your sleeves, and you’re connected to people with real estate savvy, you are ready to get started on your house-flipping adventure. Do your research, and you could have amazing success.
THIS IS NOT OFFICIAL FINANCIAL ADVICE.