3 Reasons House Flipping Could Be The Right Real Estate Investment For You
Real estate is one of the most popular forms of investment. Even though the market can be volatile at times, it always evens out, which is a draw for investors. If you’ve decided to invest in real estate, you may be surprised at just how many options there are.
There are rental properties, real estate investment trusts (REIT), real estate investment groups, real estate crowdfunding, and house flipping, just to name a few. These are all good options, but which one is right for you will depend on your unique circumstances. For now, let’s talk about house flipping.
House flipping is a hands-on way to make a real estate investment. You have complete control over what properties you buy, and what’s done to them. You don’t have to check in with groups, or worry that someone else will make a bad decision.
It’s an option that lets you control your fate, at least as much as is possible in the real estate world. Flipping houses is profitable too when you do it the right way. On average a flip makes about $70,000 in profit when all is said and done.
If you’re interested, read on to learn more about the three reasons house flipping could be the right real estate investment for you.
1. Finding Funding Is Easy
If you’re ready to start flipping houses, you need the money to make your first purchase. You can get a flipper loan right now to cover the cost of your first house. The loan will provide the money for the actual purchase and the renovation.
That means you won’t have to worry about finding and repaying multiple loans. Having the money you owe in one place makes repayment much less stressful. When your flip sells, you can use part of your profit to pay back the loan and then be off to your next venture.
The ease of getting started allows you to jump right into this area of real estate and begin building your portfolio.
2. You Can Make Quite The Profit
Buying low and selling high is the main strategy of house flipping. Sometimes, buying low means buying during a recession. Other times, it refers to finding a house that’s been on the market for a while because it needs repair work.
A fixer-upper will be cheaper, meaning you have more money to work with when it’s time to do repairs or if something goes wrong. When dealing with a fixer-upper it’s important to understand just how much work it needs.
Bring in a professional to inspect the house before you buy it to ensure there aren’t major issues. You don’t want to end up on the hook for repairing a foundation or putting on a new roof. Those sorts of repairs destroy your renovation budget and can prevent you from making the profit you need when you sell.
Keep in mind that a fixer-upper is a great investment, it just requires planning and research.
3. It’s Easy To Grow Your Portfolio
After you flip your first house, you can use some of the profit to buy another. Over time, you can build a decent nest egg and begin branching out to other areas of real estate. One great way to grow your portfolio with your house flipping money is to invest in rental property.
In the same way that you can flip a house to sell, you can flip a house to rent. The same basic principles apply. You buy a house in need of work, do some upgrading, and then instead of selling it, you rent it.
You could even look into buying and repairing an old apartment building. It’s more costly, but there’s a higher potential for a significant profit.
In addition to looking great in your investment portfolio, this gives you an ongoing source of income to support yourself and your real estate ventures. That means more money to buy new flips and more income for you overall.
With careful planning, you can use house flipping to create a profitable, ongoing real estate business.
If these three reasons resonate with you, it’s time to make a clever real estate investment and join the house flipping family.