Flipping houses has become a big deal, comprising over 7 percent of all U.S. home sales during 2020. That’s more than 200,000 homes yearly. Yet, this pursuit, while exciting and often financially rewarding, is not easy nor is it without risks.

What are the Risks?

To avoid complications, understand the possible risks in flipping houses which include changing or misreading market trends, not understanding demographic shifts, an unexpected or unfavorable change in interest rates, picking the wrong time of year to put the house on the market, making an error in property valuation, not properly estimating the needs and costs of renovations, finding out some unknown or hidden repair needs, and difficulties with contractors. An informed approach to these potential problems will help you achieve a successful flipping project.

Things to Know Before Flipping Houses

First, it is critical to establish your flipping objectives and to know the limits of your time and abilities.

Second, create a solid budget. Determine what you can afford to spend for your flipping investment. This budget will help you zero in on properties within your affordability range.

Third, find real estate properties for sale. Consider your budget, the condition of the local housing market, and the degree of real estate activity in your targeted area.

Fourth, as you zero in on a property to flip, carefully analyze the offer price, the calculated cost of repairs, and the after-repair value, so that you can determine the project’s potential profit.

Fifth, negotiate an acceptable price with the property owner.

Sixth begin repairing and updating the property.

Seventh, market the house for sale.

Eighth, negotiate an acceptable price with a property buyer.

What Financing Options are there for Flipping Houses?

Financing options for flipping houses include cash, hard money loans, private money lenders, and real estate partnerships.

Seek Expert Financial Assistance

Contact Fortis Funding based in Glen Allen, VA. Having the capital for continued growth is vital for startup owners and entrepreneurs who are flipping houses. We have a comprehensive portfolio of business loans to meet your needs now and in the future.