The term flipping houses basically means buying a house or other property under market value with the intent to fix it up and sell it for a profit. While this is an exciting prospect, there are a few things that you should consider before taking the plunge into the world of fixer-uppers for profit. Some of these considerations include location and exactly how much you can afford to invest in the purchase price. Other factors include resolving liens and tax arrears, build-out costs, marketing costs, taxes, insurance and maintenance costs. If all goes according to plan, you could make a very healthy profit.
Tips for Successfully Flipping Houses for a Living
If you are interested in flipping houses, the experienced professionals at Central Texas Auction Services recommend doing your research including:
• Determining your operating costs: Operating costs include vehicle expenses, constructions costs, real estate broker’s commissions, legal costs to remove title issues for example any liens against the property, advertising, marketing, escrow and other items along with a separate budget to cover any unforeseen expenses.
• Choosing a source of funding: If you don’t have the cash to purchase the property outright you can research financing options such as home equity loans, equity lines of credit or small business loans. Many lending institutions will require a down payment and a form of collateral to apply for a loan.
• Finding service providers: Do your research and check references when planning for services including construction contractors, painters, electricians, plumbers, landscape services etc. Contact the Better Business Bureau or the local Chamber of Commerce to find service providers who are both experienced and qualified to get the job done correctly.
• Applying for permits and licenses: Some states and/or counties have specific requirements. Check with your local and state agencies to find out if your new investment requires licensing or permits such as general contractor or real estate sales licensing.
• Finding a property to flip: Check the upcoming property auction link at Central Texas Auction Services to find houses slated for auction. Banks will often work with auction companies to sell foreclosure properties which can be purchased for well below their true market value.
Six Steps to Purchasing a Fixer-Upper Property
1. Find potential properties that you might be interested in
2. Confirm the auction status
3. Check for local market value in the surrounding areas
4. Determine your bid amount
5. Bid at the auction
6. Take ownership of your property
Do Research When Flipping Houses
Make sure you do all the necessary research, be sure to read all of the documents and transaction details prior to attending the auction. Take the time to research the estimated market value of the property you are interested in and if possible drive by the property to determine the outside condition. Never trespass or disturb any of the occupants, doing so is considered a criminal offence and is punishable by law.
Absolute, Minimum Bid & Reserve Real Estate Auctions in Belton, Killeen, Temple & Central Texas
Keep in mind that when you bid on a foreclosure property, you are bidding on a property in an “as-is” condition meaning that you won’t know what condition the property is in, especially the interior until you take final possession. When you have decided upon the amount you are going to bid, take into consideration the cost of any unexpected repairs. For information on upcoming auctions in the Belton, Killeen, Temple & Central TX area contact the knowledgeable real estate experts and auctioneer specialists at Central Texas Auction Services today!
