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Anyone ever flipped a house?
- Thread starter bfreebern
- Start date
Devil Doc
When Death smiles, Corpsmen smile back
No, but I've tipped an outhouse.
Doc.
Doc.
Never done it, but I do know right now is a horrible time to flip houses. The market is flooded with affordable housing, which means you could buy a house to flip for cheap, but your going to have to hang on to it for a long while until the market turns around a but to make sure you can make an ok amount for the house.
If you can afford to hang on to a house that will be difficult to rent and sell for awhile, you could get one for a really good price. If you want to be able to do a true flip and sell it quickly right now is a bad time for that.
If you can afford to hang on to a house that will be difficult to rent and sell for awhile, you could get one for a really good price. If you want to be able to do a true flip and sell it quickly right now is a bad time for that.
IBQTEE1
Its All About Zen in 2010!!
LilBastage
Meat is murder! Tasty, tasty murder.
MY sister in law got the idea in her head from one of those TV shows about flipping houses, so she tried it up here in Duluth. She bought a really inexpensive fixer upper and put about $12,000 into it (not including carrying costs). She ended up selling it for about $5,000 more than she paid losing a lot of money.
She did a fine job with the house, but the neighborhood couldn't support the price she needed and the housing market has never been really "hot" up here as we have had a declining population for years.
Know your market and research, research, research. Don't go into it lightly.
I'd wager to say that in most areas of the country flipping houses isn't a good idea right now. A lot of the foreclosures out there are people who bought houses to flip and got stuck with them.
She did a fine job with the house, but the neighborhood couldn't support the price she needed and the housing market has never been really "hot" up here as we have had a declining population for years.
Know your market and research, research, research. Don't go into it lightly.
I'd wager to say that in most areas of the country flipping houses isn't a good idea right now. A lot of the foreclosures out there are people who bought houses to flip and got stuck with them.
I appreciate all the comments.
House I'm considering, I can probably get for 79k. Put 10k into it and list it around $104,000 to $109,000 just to sell it. I know 15k to 20k isn't that big of a profit, but it's still 15k to 20k.
House I'm considering, I can probably get for 79k. Put 10k into it and list it around $104,000 to $109,000 just to sell it. I know 15k to 20k isn't that big of a profit, but it's still 15k to 20k.
bfisher88
Livin' The Dream
I flipped a condo with my dad last summer that he picked up from a guy for dirt cheap because they were going through an eviction process. He somehow got it for 50k. After putting about 15k into he relisted it again, for 105k. The last condo in that subdivision didn't sell for under 100k so we figured it would sell quickly. Well when it was all said and done, the market just wasn't strong enough and the price had gone down to 85k or so. All in all he made 20k but that was about half of what he was expecting to make.
If your profit margin is only around 15k, i'd say it's a little risky to try and get exactly what you want out of it. Especially if a fixer upper will only appreciate that little in your housing market. Hope this helps.
Breedy
Busted
- Joined
- Nov 14, 2007
- Messages
- 2,123
I would just caution you to be careful. If you know a real estate agent perhaps you could have them pull "comps" on what you want your end product to be. Also an agent should be able to tell you how long a houses have been on the market.
Further, you need to be careful because a lot on lenders are begin very cautious with loan approvals, kind of the counter effect of all those in defult. So a lot people who in theory could afford to purchase your flip, may not be able to get financed due to questionable credit score. Along those lines as well make sure that your house will appraise for more than your asking. My wife is an agent and a couple times here in Ohio, she has had people willing to pay X amount, but after the appraisial the bank says it is worth Y, which is less than X, so the loan is then dead.
I am not meaning to scare you off doing something and 10-15k is a lot of money regardless of who you are, but just make sure you can abosrb the short term decrease in budget to wait for the pay of at the end (don't forget there will be misc. fees associated with selling, and don't be suprised if the buyers ask you to pay up to 6% of closing.)
jfields
Where did all my money go?
You need to allow for "unforseens" as well, you know how that can go.
Another thing to do, would be to not just rely on a realestate agent. I would call a good mortgage broker if you know one. Have him check the area you are thinking about buying in and see if it is considered a declining market zone. You might be good where you're living at, but fifteen miles away can hurt you, believe it or not.
The one thing I know for sure on home improvement projects. They end up costing more than your budget, by a factor of 15-30%. You need to do your homework like others have said. Know your market and know what profit margin you can live with.
KayakinBoy
I was raised in the canebrake by an ol' mama lion
I know all markets are different, but most houses in my area have been sitting for a couple of months, but when they sell, it's usually for 15 to 20k less than what they were listed for. Becareful man. ???
MiamiCubano
El Martillo (My Boxing Name)
Sent you a PM Brandon. 
Some good advice here. My experience in doing this in large part involves getting in on pre-construction deals of penthouses, etc. Then, selling them when they are complete and built out. Have also picked up some homes here on So. Beach and turned them, after some rennovation/remodel, but as others have stated, it's not a fantabulous market right now...good for picking up deals if you can ride it out and float both before flipping.
Some good advice here. My experience in doing this in large part involves getting in on pre-construction deals of penthouses, etc. Then, selling them when they are complete and built out. Have also picked up some homes here on So. Beach and turned them, after some rennovation/remodel, but as others have stated, it's not a fantabulous market right now...good for picking up deals if you can ride it out and float both before flipping.
Eshaw99
Just livin' the dream
The best advice I've heard on this is be prepared to spend twice what you budget for both money and time.
Thanks guys, much appreciated.
My wife is thinking of going into it, with the mindset to rent it to her sister and her fiance. Then in a year or two, sell to them, once they are on their feet. We'll see how that goes.
My wife is thinking of going into it, with the mindset to rent it to her sister and her fiance. Then in a year or two, sell to them, once they are on their feet. We'll see how that goes.
KayakinBoy
I was raised in the canebrake by an ol' mama lion
Sounds like a better idea than flipping, IMHO. Be sure to get a real lease drafted. I know they are family but... I think there's an old saying about family and money? :whistling: :laugh:
I know, I'm still in the process of discussions with the wifey unit.
mmburtch
Sleep deprived and cranky
My father does this with a partner, he is only cash in the deal. They plan to spend 20% of what they pay for a property on remodeling. They have been successful, but they are also in one of the only climbing markets in the country right now.
A few of the things that have made them successful are:
A real estate liscense-- othrwise take 6% of the selling price off your profits
A crew of sub-contractors that they have at their disposal
Designer accounts with the local suppliers---Discounts, discounts,discounts
A supply of componets bought at close-outs
We custom built our home three years ago. As a stay at home dad, I had time to search the internet for deals, and saved thousands of dollars on lighting, appliances and even doors. There is mney to be saved if you have time to search and wait for it to be delivered.
Assess your market, your buying power, your timeline and your contacts. 79-109K is a tight window of oppertunity.
A few of the things that have made them successful are:
A real estate liscense-- othrwise take 6% of the selling price off your profits
A crew of sub-contractors that they have at their disposal
Designer accounts with the local suppliers---Discounts, discounts,discounts
A supply of componets bought at close-outs
We custom built our home three years ago. As a stay at home dad, I had time to search the internet for deals, and saved thousands of dollars on lighting, appliances and even doors. There is mney to be saved if you have time to search and wait for it to be delivered.
Assess your market, your buying power, your timeline and your contacts. 79-109K is a tight window of oppertunity.
Totally agree. I'm not looking to get rich off this deal. I like doing this kind of stuff and the opportunity fell. If we could get it cheaper, it might make it a better deal.
I've walked the neighborhood and gotten the info from other houses being sold. I've done a little research on the net. If this thing went through, selling it at 109k would be priced to sell. I don't want to get into something, then price it at a competitive 129k and it not sell, then have to drop the price after a few months.
I do appreciate all the input, this is why I posted the topic.
Rebel Herfer
Adiskide honekin, orduak labur!
Better yet, PM or call a Mortgage Banker...like... ME. Brokers are not direct lenders. I have access to all the info you'll need. I've participated in several flips over the years & it can be tough if you don't completely know what you are in for, and how to get it done. Carrying costs in today's market is a bear, not to mention investment properties will require 25-30% down with substantial assets, and you must qualify to carry the payment. You could always go the hard money route bt that'll run you 15%+ interest only with 3+ Points and only for 6 months. If you or any BOTL/SOTL has any questions regarding mortgages please feel free to contact me at 800-317-7463 x35738 or directly at 469-737-5738.
